Saturday, April 26, 2008

The Energy Crisis of 1973, Tomcats and Cars

This week we had new carpet (made of recycled plastic bottles) put down throughout the upper floor of of our tiny home. To prepare for this traumatic event my husband and I moved boxes of stuff from closets and bookshelves to the lower floor. Today, we are putting stuff back and I came across a notebook filled with tear sheets of my old newspaper stories. This blog is a result of that discovery.

In the fall of 1973 I was working for a small newspaper in Virginia while the U.S. was experiencing its first oil shortages. One November issue of the weekly featured a huge photograph of railroad cars piled high with coal awaiting export to places around the globe. A sudden surge in the demand for coal had clogged up supply lines as unexpected demands for
shipping vessels were unmet in the short term.

Stories on the frontpage discussed solar energy research, the increasing demand for coal and the local demand for electricity. (I think the issue a week before had featured photos of closed gas stations and cars lined up around the block at stations that were still open.) One in particular caught my eye. The headline: "Local refinery still depends on Iran." For a moment I was confused. The oil crisis of 1973 was a result of the Arab Oil Embargo of Western nations during the Yom Kippur War. Then I realized Iran was not considered an Arab country. Its people were and are still Persians. I turned to an internet search to find out more and learned that in 1973, one of America's most powerful allies, the Shah, was still in power in Iran. I also learned that the Nixon Administration had just sold a bunch of Tomcat airplanes to Iran. The story was old but had been updated last December. It went on to say that Iran still owns about 30 Tomcats and that the planes are capable of carrying payloads which has turned out to be a problem for the U.S. and Israel.

Check this out at:

The following entry from Wikipedia explains the causes of the 1973 oil crisis:

The 1973 oil crisis began on October 17, 1973, when the members of Organization of Arab Petroleum Exporting Countries (OAPEC, consisting of the Arab members of OPEC plus Egypt and Syria) announced, as a result of the ongoing Yom Kippur War, that they would no longer ship oil to nations that had supported Israel in its conflict with Syria and Egypt (the United States, its allies in Western Europe, and Japan).

About the same time, OPEC members agreed to use their leverage over the world price-setting mechanism for oil in order to raise world oil prices, after the failure of negotiations with the "Seven Sisters" earlier in the month. Because of the dependence of the industrialized world on crude oil and the predominant role of OPEC as a global supplier, these price increases were dramatically inflationary to the economies of the targeted countries, while at the same time suppressive of economic activity. The targeted countries responded with a wide variety of new, and mostly permanent, initiatives to contain their further dependency...

Despite being a target of the embargo as well, Japan fared particularly well in the aftermath of the world energy crisis of the 1970s compared to other oil-importing developed nations. Japanese automakers led the way in an ensuing revolution in car manufacturing. The large automobiles of the 1950s and 1960s were replaced by far more compact and energy efficient models. (Japan, moreover, had cities with a relatively high population density and a relatively high level of transit ridership.)[citations needed]

A few months later, the crisis eased. The embargo was lifted in March 1974 after negotiations at the Washington Oil Summit, but the effects of the energy crisis lingered on throughout the 1970s. The price of energy continued increasing in the following year, amid the weakening competitive position of the dollar in world markets.

The crisis was further exacerbated by government price controls in the United States, which limited the price of "old oil" (that already discovered) while allowing newly discovered oil to be sold at a higher price, resulting in a withdrawal of old oil from the market and artificial scarcity. The rule had been intended to promote oil exploration.[8] This scarcity was dealt with by rationing of gasoline (which occurred in many countries), with motorists facing long lines at gas stations.

In the U.S., drivers of vehicles with license plates having an odd number as the last digit (or a vanity license plate) were allowed to purchase gasoline for their cars only on odd-numbered days of the month, while drivers of vehicles with even-numbered license plates were allowed to purchase fuel only on even-numbered days.[9] The rule did not apply on the 31st day of those months containing 31 days, or on February 29 in leap years — the latter never came into play, since the restrictions had been abolished by 1976...

Coupons for gasoline rationing were ordered in 1974 and 1975 for Federal Energy Administration, but were never actually used for this crisis or the 1979 energy crisis. [11]