The 40-year anniversary of the 1973 Arab oil embargo's beginning has made many energy community members consider progress that has made in the time since—and how many underlying problems remain unsolved.
Western industrialized nations could not ignore Arab producing countries' willingness to use a cutoff of their exports as a weapon during the Yom Kippur War. The supply interruption quickly doubled retail gasoline prices. Consuming countries' governments understood that long-term heavy reliance on imports from politically unstable regions was a bad idea.
Many early responses unsuccessfully focused on controlling prices and managing supplies. Consuming nations also formed their own alliance, the Organization for Economic Control and Development, and established the International Energy Agency to monitor supply and demand.
Following a second global oil supply shock in 1977-78, they also established and began to fill individual strategic petroleum reserves, and agreed to share crude stored there during emergencies. Some US lawmakers scoffed at the idea until oil products arrived from overseas after Hurricane Katrina crippled the US Gulf Coast's refining system in 2005.
Energy was such an essential economic component that international cooperation was able to overcome domestic politics in several important cases. US foreign policy incorporated the need to keep overseas supplies reliable and maritime transportation routes safe.
Improving technology sent producers deeper into the North Sea, making Norway and Great Britain major producers, and occasionally costing lives. Engineers embraced the challenge of producing energy in climatically hostile environments, and from seemingly inaccessible geologic formations. Research at the US Department of Energy's national laboratories helped support their efforts on many fronts.
Reliable data's impact
US policymakers also recognized the need for reliable, impartial data and established the Energy Information Administration as an independent analytical and forecasting part of DOE. EIA's stature eventually reached a level where its information provided the basis for fuel contracts. It also began to collect carbon dioxide emissions data in response to growing global climate change concerns despite heavy cuts under the 2011 federal budget sequestration agreement.
EIA kept functioning even after the 113th Congress let the federal budget expire and the national government began to shut down on Oct. 1. It lasted until Oct. 11, when it finally ran out of money and announced it would close and furlough its staff at the end of business that day. Its web site and social media channels would not be updated, and it would not publish data and analyses until funding was restored. EIA asked survey respondents to continue submitting data, which it would process once its employees return.
Meanwhile, IEA continued to operate as its US counterpart became a political casualty.