The Geopolitics of Energy: The 1970s Oil Crisis

The Russian oil boycott has not only shaken the global economy, but also exposes how overdue the world is for a transition to cleaner energy. Three scholars report on impacts of the boycott and emphasize the need for multilateral solutions that don’t repeat the mistakes of the past.

Back of a man in the 1970s standing to cars and holding a gas can

By Michelle Nicholasen

First in a series of interviews on the impact of the Russian oil boycott on countries around the world. 

Worldwide cuts in Russian oil imports have sent a shockwave through the global economy, threatening a global recession, according to recent IMF forecasts. At the same time, the boycott is a blunt reminder that the world is desperate for a monumental energy transition to ease the climate crisis, and even the leading economies are not there yet.

But oil is here to stay, at least for the near future. Unlike a reduction in the supply of washing machines or computer chips, the need for energy security is a national imperative that can lead to some stark trade-offs. Throughout the modern era, the drive for unlimited fuel supply/oil has resulted in compromises in environmental health, human rights, ethics, and international peace. Today’s self-imposed oil shortage is forcing nations to find alternative sources of fuel and forge new relationships in a truly global market.

To learn more about the ramifications of the Russian oil boycott, we asked three scholars about the impacts in the countries and regions they study: Marino Auffant on Saudi Arabia and the EU; Victor Seow on China; and Oya Dursun-Özkanca on Turkey and the eastern Mediterranean. The three interviews in this series are edited for length and clarity.

In part 1, historian Marino Auffant draws parallels to the oil crisis of the 1970s, when Arab state members of the Organization of the Petroleum Exporting Countries (OPEC) limited the oil supply exported to Western countries. A recent Graduate Student Associate at the Weatherhead Center, Auffant is an incoming postdoctoral fellow at Johns Hopkins University. He has worked extensively on the EU’s energy policy and regulatory issues with Russia as both a scholar and practitioner.   

Q: Marino, how is Saudi Arabia reacting to the Russian oil boycott? 

MARINO AUFFANT: In Saudi Arabia, something that we're seeing is that it’s refusing to play the historic role of increasing production once energy markets get tight. 

And that has been one of the key roles of Saudi Arabia in the US energy strategy. Now that we're seeing scarcity because of the boycott of Russian oil, Saudi Arabia has refused to increase production accordingly, which has upset American policy makers. And I think this is part of a broader trend. 

I suspect that we may be witnessing the end of a fifty-year-long marriage between the United States and Saudi Arabia, in which these countries were interdependent—not just in terms of energy, but also financially. 

Q: And this marriage you refer to dates back to the 1970s oil embargo, correct?

MARINO AUFFANT: Yes. My dissertation looks at the way in which the United States emerged from the first oil shock from the Arab oil embargo of 1973 and 1974 as a very close energy partner of Saudi Arabia, the country that had embargoed it, which I found very paradoxical. In the 1970s, when Saudi Arabia embargoed the United States, it showed that it was indispensable to the United States's global energy strategy, and that living without Saudi Arabia as a source of oil would be very, very expensive for the United States. At a time of high inflation/stagflation and economic hardship, this was very difficult for the United States to take upon itself. 

But this wouldn't happen for free. One of the things that Saudi Arabia demanded from the United States was assurances that the United States would continue importing oil from Saudi Arabia in the long run, which meant pausing many discussions of a radical energy transition that were taking place in the 1970s. It was very difficult to implement an energy transition, as we still see today. But also it was easier and cheaper to just import oil from Saudi Arabia. 

And in exchange, Saudi Arabia would help uphold the dollar. It would sell its oil only in the US dollar, and not the sterling, for example, which dipped dramatically when Saudi Arabia announced that. And it would hold its reserves in US dollars in the US Federal Reserve and Treasury. 

This is an arrangement that is falling apart today. The US seems more serious about making an energy transition. It is more independent from Saudi Arabia, in terms of being able to export oil. And Saudi Arabia has even threatened to sell oil in Chinese yuan. 

To me, this signals something that goes way beyond the things that we see in the news, like Jamal Khashoggi's murder. As I mentioned earlier, this may be the end of a fifty-year-long close relationship of economic and security integration between the US and Saudi Arabia. I don't have a crystal ball, so as a historian, I try not to make predictions. But these are the trends that I am seeing.

Q: Do you see any similarities between the current oil crisis in Europe and the oil embargo in the 1970s? You studied the OPEC oil embargo when France was so desperate to find alternative sources of oil that it decided to trade nuclear technology to Iran in exchange for oil. This broke with the solidarity that had been established among European nations. And today, Europe is now in a self-imposed energy crisis by boycotting Russian oil. In the quest to maintain stability, will countries like France or Germany ultimately decide to go it alone and make their own deals with oil producers? Or do you see them pulling together? 

MARINO AUFFANT: Yes, it's very ironic. The 1970s energy crisis was because of an Arab oil embargo. And now we're seeing a boycott that is a self-imposed embargo and a self-imposed energy crisis in order to have solidarity with Ukraine. 

There’s big parallels, but also big differences. The parallels are clear. I mean, we're witnessing high energy prices, a drop in supply, the search for alternatives to hydrocarbons, high inflation, war is going on, there is a culture war domestically, political polarization… and the US and Saudi Arabia are not getting along. 

And we have many questions about renewable energy and a green future and finding alternatives. This all happened in the 1970s as well. So, I find it interesting, but also sad to feel history repeating itself in some ways.

In other ways, we’re seeing a very different scenario. First, this was a deliberate policy choice by European countries. They’re actually banding together, at least so far. Second, I think they're able to do it because of a major change that was not the case in the 1970s: the United States is now, again, a major oil and gas exporter. 

Back in 1967, the United States told its European partners that if there was an attempt at an Arab oil embargo during the Six Day War between Israel and the Arab world, the United States would export oil to Europe to make up for the loss. One year later, they said we won't be able to do this again. Effectively, they were not able to do it in the 1970s or in the 1980s. But now they can, because of US shale, oil, and gas production. 

And I think this has created more trust among European governments vis-a-vis the United States's ability to deliver. 

And although it never became the consumer cartel that Henry Kissinger wanted to counter OPEC, the International Energy Agency that was created as a result of the first oil shock had many emergency measures put in place for countries to be able to share resources, in case something happened like is happening now. 

So we have these structures in place now. And the United States is in a much better energy position overall than in the 1970s, even if US consumers are feeling the higher prices. I think the European Union may switch back to what was happening before, historically, in terms of importing oil and gas from the United States when necessary, and they may also turn to their former colonial territories in Africa, North Africa, and the Persian Gulf. 

But it’s hard to make up for the 30 percent of European gas that comes from Russia. I don't think the European Union has the infrastructure to be able to import liquefied natural gas at the rate that would replace the Russian pipelines. But there is a hope that Europe will move in that direction, and investments are being made for that to happen. 

Now, if Europeans find out that this is extremely difficult, and that they cannot make up for it, then we may find ourselves in a reverse scenario, like in the 1970s, when the United States realized that the cost of not depending on Saudi Arabia was so high that they'd rather just find a way to move forward together. In that case, the European Union would conclude that it has no alternatives to Russian natural gas, and might strike a new mutually beneficial partnership with Russia.

And I don't discard that yet. We're still in the euphoria of European support for Ukraine, and the true cost has not yet come. We are in the summer. Europe's gas needs will spike next winter. And I want to see how European countries can prepare to face the next winter without Russian gas infrastructure. Infrastructure does not get built overnight. 

Time will tell, and the West will get tested; I think the United States is trying to set up the infrastructure, along with its European partners, necessary to succeed in the task. But if they don't, then you can find yourself with the breakup of Western cooperation similar to what happened in the 1970s. It was a big headache for US policy makers, with each country then trying to save its own economy. 

And when countries get desperate, they can take major risks. This was the case for France in the 1970s, when they did something that turned out to be quite dangerous: exporting nuclear reactors to Iran and Iraq in order to secure nice oil deals. But at the same time, it's hard to blame a country for trying to save its own economy and its consumers and citizens. And when that test comes, then we will see. So far, countries are holding together in a way that was not the case in the 1970s. 

Q: What is your take on the oil curse, the theory that oil-rich countries tend to be authoritarian?

MARINO AUFFANT: So the oil curse is well known, and Iran, Saudi Arabia, Venezuela, and Iraq are great examples of what can happen when a country becomes addicted to oil, and then things go wrong. 

But I have to say that as a historian, there are also many cases in which oil was an engine of democratization for these countries. And that's one of my big issues with Timothy Mitchell's argument in Carbon Democracy: Political Power in the Age of Oil. I buy his argument on coal—that both its production and its material infrastructure rely on a large labor force and therefore lean toward democratic processes—but there are historical examples in which this also has applied to oil. I can give you three examples.

In the Mexican Revolution, oil played a huge part. The labor movement was galvanized to such an extent that the Mexican government ended up nationalizing the oil industry in 1938. And this came from bottom-up pressure. Then, if you think of Iran, the nationalization of the oil industry was carried out in 1951 by then-Prime Minister Mohammad Mosaddegh, by a democratic government, also with great support from the labor movement within the Abadan refinery, for example. And even the birth of the Saudi Arabian labor movement happened in the oil sector in the 1950s. There were factions of the Saudi royal family that supported the labor movement that saw themselves as socialist leaning. That's gone. But these dynamics were there, and I want to historicize this, because it can be very easy to think that oil necessarily must lead to dictatorship. 

Q: To what extent does the type of government you are buying from matter, if you are desperate for fuel?

MARINO AUFFANT: There was a point in time, for example the 1960s, where Middle Eastern dictatorships were seen as unstable and insecure because they were authoritarian, while democratic regimes like Venezuela were seen as stable for the United States, in terms of its energy policy and where it wanted to get its oil. 

The way that the CIA, for example, analyzed Saudi Arabia in the 1960s was like, ‘here is a very repressive regime. There is a potential for a coup d'état. There could be a revolt or a revolution. We should not be importing oil from there.’ Well, Venezuela's government seemed more responsive to the population, hence more secure. 

By the 1970s, the logic had flipped. So states that had a lot of popular pressure to get more control over the oil industry, like Venezuela, were increasingly seen as being hostile to capital—hence unstable. And the stability of the Saudi monarchy was seen as something that had to be supported. 

So the US shifted from relying on sources of oil that it saw as secure, like Latin America, to making the Persian Gulf secure through arms sales, and a heavier military involvement in the region, in order to protect these oil interests. So again, shifts happen, and it's easy to think that the way things are now is the way they always were. But there was a point in time in which, for example, the dictatorship in Saudi Arabia was seen as a threat to capital, not necessarily as an attractive thing for oil investors. 

Q: The 1970s oil crisis sparked the need for alternative sources of energy. Why did the momentum stall?

MARINO AUFFANT: The energy crisis showed to policy makers that the West was addicted to oil and consuming it way above its means. 

Previously, there was little awareness of conspicuous consumption. For example, cars were getting bigger. There was more air conditioning. And there was little effort to make them more energy efficient. But with high prices and oil scarcity, this had to change, and there was a lot of talk of an energy transition. What happened then may be similar to what we will see now. 

On the one hand, governments made a lot of efforts to invest in renewables. So for example, during the 1970s, the US invested billions in solar energy research, which has paid off in the long run, even if China leads the market today. But a lot of these innovations happened there. 

On the other hand, there were some gray areas. For example, France massively expanded its nuclear power park. There is a debate of whether nuclear power is green or not. I personally see it as green-ish, at least. But it's hotly debated. 

And in Germany, for example, in the 1970s, there was the growth of a huge green movement that was very strongly opposed to nuclear power, because of the risks involved. And indeed, we still don't have a very satisfying solution to the management of nuclear waste that will be radioactive for hundreds of thousands of years, or security concerns, like we saw with Fukushima or Chernobyl. 

Finally, there was also an effort to get energy wherever you found it. And if that meant coal, then you would get coal. So that happened here in the US, and it also happened in countries like India. And part of what happened was a huge turn toward coal. 

And these things are happening at the same time, which is why it's hard for me to say what the result of the 1970s crisis was in terms of greening the world. The world emerged from it more dependent on Persian Gulf hydrocarbons than ever before. 

But also, there were many seeds planted for future technologies, and there were some transitions, some green, some not, and some question marks, like nuclear. I think we may see something similar today. 

I don't see this as linear, but as chaotic. However, something that is important when we think of renewables is that if you have a lot of renewables in your energy, in your electricity production, you need a form of energy that is quick to modulate, because renewables are unpredictable. 

The wind and the sunshine will go up and down, and you can't always predict that. Then you need something that moves as fast as that. And it tends to be either fuel oil, gas, or coal. In that sense, the least polluting of them is natural gas. But natural gas also contributes to climate change. 

So this all becomes very complicated. The more you add nuclear power, the less you have to depend on renewable energies and natural gas. So there is a difficult equation there. 

Q: What are the most likely ways to fill the wind and solar gaps, and who is poised to get there?

MARINO AUFFANT: In the end of the day, the answer to these dilemmas will be electricity storage. If you can store electricity, then you can overproduce renewable energy, store it, and use it when renewable production goes down. But we're not there yet. We're trying to work toward that, and it will be a race. Will China get there first, or the United States? Tesla is trying to do it. As of yet, we don't know. 

And if we still rely on gas, then the countries that produce gas are, well, Russia, Iran, and Qatar. So from a geopolitical standpoint, these are all complex countries with which the United States has difficult relations—not just Russia and Iran, obviously, but even Qatar. 

The relationships between Saudi Arabia and the UAE and Qatar are very complicated. So it turns out that nature's bounty placed natural gas in some specific geographies that are conflict zones. I think in the end, it will be a race toward innovation, and which country manages to create efficient electricity storage first. Or an alternative that maybe we haven't thought about. I mean, we don't know what we don't know. It may be China, or the US, or a private company. We don't know where that will lead. But fingers crossed.

If we manage to succeed, then that changes the whole equation. If not, we will still need to find a way to bring natural gas into our energy mix, which geopolitically keeps us stuck in this situation of dependence on countries like Russia, Iran, or Qatar. There is some hope to diversify into countries like Azerbaijan or Turkmenistan, but their gas production is so small compared to, say, Russia.

President Joe Biden stands on a stage with leaders of the GCC countries, Egypt, Iraq, and Jordan

Q: As the world shifts to cleaner energy production, what is the most important lesson that you derive from your research? 

MARINO AUFFANT: What I would say is don't expect it to be easy, and don't isolate energy from the larger system. And the system, for me, includes everything from geopolitics to finance to food production. We didn't discuss this, but oil is a big input for fertilizers, which are affected by oil prices. You then realize how oil is present in so many different aspects of the economy, on top of the geopolitical relationship, and on top of the financial relationships that are based upon the revenues and profits made from oil that these countries leverage. 

So expect hydrocarbon producers to fight against an energy transition. They've done it in the past, and they will do it again. And then, the more we transition, the more we may discover that there is a whole new geopolitical geography of raw materials for wind turbines and for solar panels that we may not really have thought through, and that may lead us to similar countries again. For example, wind turbines use a lot of rare earth elements. And these are mostly produced in countries like China or Myanmar. Some are in the US, but most of the production is in China. Or rare metals that you may find in Russia, or the Democratic Republic of the Congo. 

So expect a new type of geopolitical competition to ensue, in order to control the raw materials that will go into this. I would not expect it to be free from conflict. And we may romanticize green energy as freeing us from conflict, and we may soon discover that it will most likely create a whole new geography of conflicts and frontiers for raw materials. So expect the unexpected.

Read more in The Geopolitics of Energy series

Contributor Bio

Marino AuffantMarino Auffant is a recent Graduate Student Associate at the Weatherhead Center for International Affairs, and is concluding his PhD in the Department of History at Harvard University. He is an incoming America in the World Consortium Postdoctoral Fellow at the Kissinger Center for Global Affairs at Johns Hopkins University. His research focuses on the international history of the 1970s Energy Crisis. Through the prism of the oil shocks, he studies the transformation of world order in the 1970s in various realms including energy markets, geopolitical realignments, nuclear proliferation, global finance, and international monetary relations.


  1. “Some Motorists Ran Out of Gas Such as This Man in Portland and Had to Stand in Line with a Gas Can During the Fuel Crisis in the Pacific Northwest,” December 1973. Credit: US National Archives, from the EPA collection DOCUMERICA. National Archives Identifier, 555460. Photographer: David Falconer
  2. OPEC Oil Embargo, 1973. NBC Nightly News coverage of OPEC's decision to cut exports of oil to the United States along with other nations. Reported by John Chancellor on the evening of October, 17 1973. Credit: RetroMan, YouTube
  3. President Jimmy Carter’s Address to the Nation on Energy, April 18, 1977. Accessed via Miller Center, University of Virginia. Credit: US National Archives (for full video of the speech visit the Miller Center website)
  4. In his first trip to the Middle East as US president in July 2022, Joe Biden met with Crown Prince Mohammed bin Salman to shore up support against the Russian invasion of Ukraine, and to ask for an increase in oil production, in spite of last year’s release of a US intelligence report that charged the crown prince with the brutal murder of journalist Jamal Khashoggi in 2018. Afterward, on July 16, President Biden met with members of the Gulf Cooperation Council (GCC)—Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, and the United Arab Emirates; the Republic of Egypt, the Republic of Iraq, and the Kingdom of Jordan (together known as the GCC+3). In the meeting, called the “Jeddah Security and Development Summit,” the members address regional issues such as food security, climate change, healthcare, and building solidarity against Iran. Credit: Wikimedia Commons, Public Domain