When Oil Functioned As A Weapon of The War Ahmad Ullah
The 1973 oil crisis was a significant event in the history of the world economy that sparked Arab Nationalism. The Organization of the Petroleum Exporting Countries (OPEC) imposed sanctions on the West. As a result, its allies, including the United States, experienced the most severe oil crisis of all time.
The situation was so severe that no more than one or two cars could be seen on the roads of the Netherlands. Most petrol pumps were shut down. Germans took to the streets to demand oil.
In 1967, during the six-day Arab-Israeli war, Israel occupied several lands in Egypt, Syria and Palestine. Naturally, the idea was that the Arab world would go to war again to reclaim this land. However, Syria and Egypt were waging another war with Israel to reclaim the lost land. Through this war, Arab nationalism awoke. As a result, other Arab countries came forward to help Syria and Egypt. Meanwhile, Western countries, including the United States, provided direct military assistance to Israel. That is why the Arabs could not win the war against Israel in any way. But they wanted revenge. The Arab countries united and imposed an oil embargo on the United States and its allies.
Until the middle of the twentieth century, the seven major oil companies in the Western world, Called the Seven Sisters,
dominated oil supply and pricing. They owned about 75% of the oil. Most of these companies were owned by Western countries. As a result, they always defended the interests of the western countries. On the other hand, oil-producing Arab countries did not get their fair share. Oil was supplied to western countries at the price of water. Naturally, the Arab countries were dissatisfied with these issues.
It was out of this dissatisfaction on September 14, 1980. Saudi Arabia, Iran, Iraq, Kuwait and Venezuela formed the Alliance of Oil Exporting Countries (OPEC or Organization of Arab Petroleum Exporting Countries). Although there were a few member states at its establishment, soon, the total membership stood at 13.
Two people from the Arab world played a vital role in this incident. One was Ahmed Zaki Yamani, then Saudi Arabia’s oil minister, and the other was Dr Fadhil Chalabi, permanent under-secretary of the Iraqi oil ministry. In early October 1973, a meeting was convened in Vienna with the oil ministers of the Arab countries. There was talk of raising oil prices. At that moment, turning everything upside down, the Arab-Israeli war began unexpectedly. A few days before the meeting, however, it was thought that a big war was coming. But no one then thought that such a big decision could be taken against the western countries.
The battle of Yam Kippur started on October 6, 1973. Syria and Egypt invaded Israel. The attack was carried out to reclaim the lost land of 1967 and to avenge that war. In the beginning, the Arab army was doing well. On October 16, 1973, the Arab world took a historic step. For the first time in history, the Arab oil-producing countries came together and announced a one-sided oil price exclusion from the oil companies. Not only that, the price of oil was increased by 70% as per the proposal of Dr Fadhill Chalabi. The Western world was shocked to hear the news of rising oil prices. Power suddenly went to the Arab countries of the OPEC alliance.
But that’s not the end of the story. Arab countries did not stop after just raising oil prices by 70%. They have long wanted to use their oil as a weapon against the West. When OPEC was formed together, it wanted to take advantage of this opportunity. Meanwhile, the Arab-Israeli war has started in full swing. This was the perfect time to use oil weapons. On the other hand, soon after the war began, the United States and the Netherlands sided with Israel with direct military assistance. Western allies were also working in support of Israel. As a result, the Arab countries did well against Israel initially but could not succeed till the last.
After the October 17 meeting, OPEC oil ministers remained in Kuwait. The next day, October 17, they sat again at a table. At the meeting, Saudi Oil Minister Ahmed Zaki Yamani proposed to cut off oil supplies to Western allies, especially to the United States, the Netherlands and those. They are directly helping Israel with arms and troops. Iraq, however, offered a more difficult decision. They proposed to nationalize all the Arab oil companies in the West, including the Seven Sisters.
Saudi Arabia and Kuwait played the strongest role in the October 17 meeting. All Arab countries except Iraq have decided to cut off oil supplies to the United States and the Netherlands. Day by day, this ban became stricter and stricter. Portugal and South Africa also came under the ban. As a result, there was widespread instability in the oil market. The stage of world politics turned motionless.
Since the announcement, oil prices have risen sharply in several countries, including the Netherlands and the United States; Even oil prices have risen more than 400 times. Then there were the massive oil crises in the West, and they were forced to reduce their use of oil. In the West, the crisis made long lines at petrol pumps, rationing, and a temporary ban on driving. In order to reduce oil consumption, the United States imposed a ban on driving above 50 kilometers per hour.
They experienced the most severe oil crisis of all time. The situation was so bad that no more than one or two cars could be seen on the roads of the Netherlands. Most petrol pumps were shut down. Germans took to the streets to demand oil.
Arab nationalism was awakened by the decision of the oil embargo. By such, they became aware of their own power and position. In the past, seven sisters used to buy oil from the Middle East at the price of water. This time the era seems to have come to an end. Ahmed Zaki Yamani, Saudi Arabia’s oil minister at the time, said strongly, “If Israel withdraws all of its troops from Arab lands, the embargo can only be lifted.
As oil prices skyrocketed overnight, a global economic crisis erupted. Not only that, but the balance of power in the world changed dramatically. The power that the industrialized western countries have shown to the world so far faced a big shock. They realized their weak position. On the other hand, the Arab countries became quite inspired by the national consciousness.
The oil embargo lasted until early 1964. But OPEC kept rising oil prices. Soon after, the Arab countries became rich by selling oil. Basically, from then on, the Arab countries started to become developed and modern countries dependent on oil.
The oil trade has changed dramatically since then. Western countries, including the United States, started stockpiling oil. Similarly, oil exploration began in their own countries. As a result, much of the West’s oil dependence on Arab countries has declined. However, most countries still depend on the Arab world for oil.