Académique Documents
Professionnel Documents
Culture Documents
From 1948 to 1970, oil prices ranged between $2.50 and $3.00 a
barrel. That's around $17 to $19 a barrel if adjusted for inflation. The
United States was the world's dominant oil producer. It regulated
prices. Domestic oil was plentiful. Cheap oil and gas made the expansion
of interstate highways, interstate trucking, and auto ownership part of
the America Dream. Families moved in droves to the suburbs.
OPEC did not really flex its pricing muscle until President
Nixon effectively took the U.S. dollar off of the gold standard in 1971.
The value of the dollar plummeted, taking oil revenues down with it.
All oil contracts are traded in U.S. dollars, so oil prices follow the value
of the dollar.
In 1973, OPEC halted oil exports to the United States. Its primary
goal was to boost oil prices. It also wanted to punish America for its
support of Israel in the Yom Kippur War. To prevent future shortages,
Congress created the Strategic Petroleum Reserve to provide a 90-day
supply.
The following chart shows the prices for imported Brent oil according to
the U.S. Energy Information Administration. The first column shows
the average annual price. It's followed by the high and low oil prices that
year and the month they occurred. It points out reasons for the price
variations and the accompanying events.