Background
The 1973 oil crisis and the 1979 oil crisis turned oil from a cheap to a very expensive energy source. During the 1973 energy crisis, the price of oil quadrupled. Oil never returned to pre-1973 levels, either in real or nominal terms, even during the 1980s glut.
The nominal price continued its slow increase after the crisis ended. Six years later, the price more than doubled during the 1979 energy crisis. OPEC and Saudi Arabia artificially raised the price of oil several times in 1979 and 1980. Also during this time, several OPEC members significantly lowered their production levels, the Iran hostage crisis occurred, and the Iran–Iraq War began.
There was fear that the world's oil market supply was tenuous, causing the price of oil to escalate and that OPEC would dictate very high prices in a shortage.
Read more about this topic: 1980s Oil Glut
Famous quotes containing the word background:
“... every experience in life enriches one’s background and should teach valuable lessons.”
—Mary Barnett Gilson (1877–?)
“They were more than hostile. In the first place, I was a south Georgian and I was looked upon as a fiscal conservative, and the Atlanta newspapers quite erroneously, because they didn’t know anything about me or my background here in Plains, decided that I was also a racial conservative.”
—Jimmy Carter (James Earl Carter, Jr.)
“I had many problems in my conduct of the office being contrasted with President Kennedy’s conduct in the office, with my manner of dealing with things and his manner, with my accent and his accent, with my background and his background. He was a great public hero, and anything I did that someone didn’t approve of, they would always feel that President Kennedy wouldn’t have done that.”
—Lyndon Baines Johnson (1908–1973)