How did the US respond to the 1973 oil crisis?

President Nixon and Congress responded by providing an additional $2.2 billion to the Israelis. That led to a Saudi decision, backed by OPEC, to go further and place an embargo on oil shipments to the United States and Western European countries, a decision that caused the first oil crisis of the 1970s.

What were two effects of OPEC’s 1973 oil embargo on the US economy?

The onset of the embargo contributed to an upward spiral in oil prices with global implications. The price of oil per barrel first doubled, then quadrupled, imposing skyrocketing costs on consumers and structural challenges to the stability of whole national economies.

What was the result of OPEC’s 1973 oil embargo?

The OPEC oil embargo was an event where the 12 countries that made up OPEC stopped selling oil to the United States. The embargo sent gas prices through the roof. Between 1973-1974, prices more than quadrupled. The embargo contributed to stagflation.

Why was there an oil embargo in 1973?

On October 19, 1973, immediately following President Nixon’s request for Congress to make available $2.2 billion in emergency aid to Israel for the conflict known as the Yom Kippur War, the Organization of Arab Petroleum Exporting Countries (OAPEC) instituted an oil embargo on the United States (Reich 1995).

How did the OPEC oil embargo affect Israel?

On October 19, 1973, Nixon requested $2.2 billion from Congress in emergency military aid for Israel. The Arab members of OPEC responded by halting oil exports to the United States and other Israeli allies. Egypt, Syria, and Israel declared a truce on October 25, 1973.

What was the oil shock of 1973-74?

Oil Shock of 1973–74 October 1973–January 1974 From the vantage point of policymakers in the Federal Reserve, an oil embargo by Arab producers against the US further complicated the macroeconomic environment in the early 1970s. Gas Shortage Sign in Connecticut During Energy Crisis (Photo: Owen Franken/Corbis Historical/Getty Images)

How did OPEC respond to the 1973 oil crisis?

While the fighting was still going on, on October 17, 1973, Saudi Arabia and the members of Organization of the Petroleum Exporting Countries (OPEC) wanted to punish the supporters of Israel by announcing a 5 percent cut in oil output. President Nixon and Congress responded by providing an additional $2.2 billion to the Israelis.