How do today's record high oil prices compare to the Carter era oil embargo?

The difference this time may be that demand is really out pacing supply. OPEC artificially lowered supply during the Carter era. This time, auto companies and oil companies are starting to talk about a peak oil resource problem.





The price of oil will continue to climb because world oil resource supply cannot support world energy demand much longer:





http://www.a2dvoices.com/realitycheck/En鈥?/a>How do today's record high oil prices compare to the Carter era oil embargo?
Well considering that the price of gas now is OVER DOUBLE what it was in the Carter Era (THATS INCLUDING INFLATION), I would say it really sucks to have a republican in the white house.How do today's record high oil prices compare to the Carter era oil embargo?
Well, the price of gas per gallon in inflation adjusted dollars is now slightly higher then the price of gas during the oil embargo of the 70's.


But the cause is the same, short supply and high demand.





During the oil embargo OPEC slowed distribution to the US because of our affiliation with Israel.





Now the democrat party will not allow any new oil exploration or refineries in the USA so the supply is restricted, and the demand is high, so the price goes up.
Oil Tops Inflation-Adjusted Record Set in 1980


Tuesday, March 04, 2008


The New York Times -- Capping a relentless rise in recent years, oil prices hit a record high during the day on Monday, then pulled back to close below the record.





The day鈥檚 highest trading price, $103.95 a barrel on the New York Mercantile Exchange, broke the record set in April 1980 during the second oil shock. That price, $39.50 a barrel, equals $103.76 today, when adjusted for inflation.





The surge in energy prices is taking place as investors seek refuge in commodities to offset a slowing economy and a declining dollar. Analysts pointed out that financial institutions like pension funds and hedge funds are also buying oil and other commodities like gold as hedges against a rise in inflation.
They're actually slightly higher, even after adjusting for inflation.





Of course, there isn't even an embargo - America can buy all the oil it can afford, it's just global demand is a lot higher, and speculation over 'uncertainty' in oil-producing regions fuels speculation on top of that.
Adjusted for inflation....oil prices are higher now than they were back during Carter's time.
In 1979, after the Iranian Revolution, the inflation adjusted peak was a little over 104 bucks in 2007 dollars, so it was about the same price (adjusting for inflation) as it is now.





The Arab Oil Embargo was in 1973, however, and the problem there was shortages and Nixon's failed attempt at price fixing.





References:





On October 16, 1973, OPEC cut production of oil and placed an embargo on shipments of crude oil to the West, with the United States and the Netherlands specifically targeted. The Netherlands had supplied arms to Israel and allowed the Americans to use Dutch airfields for supply runs to Israel.


http://en.wikipedia.org/wiki/Arab_Oil_Em鈥?/a>





The 1979 (or second) oil crisis in the United States occurred in the wake of the Iranian Revolution. Amid massive protests, the Shah of Iran, Mohammad Reza Pahlavi, fled his country in early 1979, allowing Ayatollah Khomeini to gain control. The protests shattered the Iranian oil sector. While the new regime resumed oil exports, it was inconsistent and at a lower volume, forcing prices to go up. Saudi Arabia and other OPEC nations, under the presidency of Dr. Mana Alotaiba increased production to offset the decline


http://en.wikipedia.org/wiki/1979_energy鈥?/a>





Personal Notes:





I find it amusing that so many people here on Yahoo conflate the 1973 embargo with what Jimmy Carter called the Energy Crisis in 1979.








This isn't ancient history. Heck, ask your parents or something.
He also closed and capped-off oil-fields all over our country... which are still closed to this day.
None.





';...Unfreezing the assets later became a condition of the hostages' release. ';





Carter going out a President was the condition on why the hostages were released.


http://en.wikipedia.org/wiki/Jimmy_Carte鈥?/a>





When the Iranian Revolution broke out in Iran, and the Shah was overthrown, the U.S. did not intervene. The Shah went into permanent exile. Carter initially refused him entry to the United States, even on grounds of medical emergency.





Despite his initial refusal to admit the Shah into the United States, on October 22, 1979, Carter finally granted him entry and temporary asylum for the duration of his cancer treatment; the Shah left for Panama on December 15, 1979. In response to the Shah's entry into the U.S., Iranian militants seized the American embassy in Tehran, taking 52 Americans hostage. The Iranians demanded:





1. the return of the Shah to Iran for trial,


2. the return of the Shah's wealth to the Iranian people,


3. an admission of guilt by the United States for its past actions in Iran, plus an apology, and


4. a promise from the United States not to interfere in Iran's affairs in the future.





Though later that year the Shah left the U.S. and died in Egypt, the hostage crisis continued and dominated the last year of Carter's presidency. The subsequent responses to the crisis鈥攆rom a ';Rose Garden strategy'; of staying inside the White House, to the unsuccessful attempt to rescue the hostages by military means鈥攚ere largely seen as contributing to Carter's defeat in the 1980 election.





After the hostages were taken, President Carter issued, on November 14, 1979, Executive Order 12170 - Blocking Iranian Government property, which was used to freeze the bank accounts of the Iranian government in US banks, totaling about $8 billion US at the time. This was to be used as a bargaining chip for the release of the hostages.





In the days before President Ronald Reagan took office, Algerian diplomat Abdulkarim Ghuraib opened fruitful, but demeaning, negotiations between the U.S. and Iran. This resulted in the ';Algiers Accords'; one day before the end of the Carter's Presidency on January 19, 1981, which entailed Iran's commitment to free the hostages immediately.
Higher today. Different circumstances. I remember gas lines blocks long, and you could only buy 10 gallons at a time then.