In October 1973, the Organization of Petroleum Exporting Countries (OPEC) placed a prohibition on the United States for supporting Israel and the Yom Kippur War. As a result, several countries, including the United States, had to face oil restrictions. OPEC provided 56 percent of the world’s crude in 1973.
The reason for embargo was to counter US decision to resupply the Israeli military and secure an edge in post-war peace negotiations. The blockade was also extended to other countries that supported Israel, including Portugal, South Africa, and the Netherlands. Petroleum shipments to the affected countries were suspended, and oil demand was reduced as a result of the embargo. Negotiations between OPEC countries and oil giants have also destabilized the price environment, exacerbating the consequences of the embargo.
The embargo resulted in a dramatic change in global economic and political influence, as OPEC countries (mostly in the Middle East) were now able to dominate dominant nations such as the United Kingdom and the United States by influencing oil supply. The 1973 Oil Embargo had a significant impact on the economies of several dominant countries that had become heavily reliant on imported oil.
The US was able to convince Israel to evict its forces from the Sinai Peninsula in May 1974. It was a strip of land east of the Suez Canal that Israel took from Egypt during the 1967 War. As a result, the ban was lifted, and oil imports resumed their normal flow.