To me there is a major “common image” in the western psyche, that although in a very indirect way in this case, still plays a major part in what kind of propaganda can be pushed regarding current and recent conflicts.
It could be summarized as :
“first oil shock = Yom Kippur/Arab embargo= geopolitical story= nothing to do with geologic constraints”
When the real story was :
– end 1970 : US production peak, the energy crisis starts from there, with some heating fuel shortages for instance (some articles can be found on NYT archive on that)
– Nixon name James Akins to go check what is going on.
– Akins goes around all US producers, saying this won’t be communicated to the media, but needs to be known, national security question
– The results are bad : no additional capacity at all, production will only go down, the results are also presentede to the OECD
– The reserves of Alaska, North Sea, Gulf of Mexico, are known at that time, but to be developed the barrel price needs to be higher
– In parallel this is also the period of “rebalance” between oil majors and countries on each barrel revenus (Ghadaffi being the first to push 55/50 for instance), and creation of national oil companies.
– dropping of B Woods in 71 (move to petro $) and associated $ devaluation also put pressure on raising the barrel price for producing countries.
– So to be able to start Alaska, GOM, North Sea, and have some “outside OPEC” market share, the barrel price needs to go up (always good for oil majors anyway) and this is also US diplomacy strategy
– For instance Akins, then US ambassador in Saudi Arabia, is the one talking about $4 or $5 a barrel in an OAPEC meeting in Algiers in 1972 (when it still was around $1)
– Yom Kippur starts during an OPEC meeting in Vienna, which was about barrel revenus percentages, and barrel price rise.
– The declaration of the embargo pushes the barrel up on the spots markets (that just have been set up)
– But the embargo remains quite limited (not from Iran, not from Iraq, only towards a few countries)
– It remains fictive from Saudi Arabia towards the US : tankers kept on going from KSA, through Barhain to make it more discrete, towards the US Army in Vietnam in particular.
– Akins is very clear about that in below documentary interviews (which unfortunately only exists in French and German to my knowledge, and interviews are voiced over) :
For instance after 24:10, where he says that two senators were starting having rather “strong voices” about “doing something”, he asked the permission to tell them what was going on, got it, told them, they shat up and there was never any leak. The first oil schock “episode” starts at 18:00
(the “embargo story” was in fact very “pratical”, both for the US to “cover up” US peak towards US public opinion or western one in general, but also for major Arab producers to show “the arab street” that they were doing something for the Palestinians).
Note : About Akins, see for instance :
And then the second oil shock (79) result of Iranian revolution, and leading to the “Carter doctrine”, with then the Reagan corollary and creation of CENTCOM.
Followed by the counter oil shock (for a big part the result of Reagan administration pushing the Saudis to produce more in order to bring the USSR down), about this for instance :
The global ignorance about all this allows to keep the messages around “old time geopolitics, this is about values, pushing democracy, bad and good guys, etc”.
By the way about Akins, his report to Nixon in 1971 should be a key document, but it is still classified to my knowledge, anybody knows whether it could now be declassified ?