1979 oil crisis facts for kids
Graph of top oil-producing countries, showing drop in Iran's production
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| Date | 1979–1980 |
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| Also known as | Second oil crisis |
The 1979 oil crisis, also known as the second oil crisis, was a time when the world faced a big problem with oil. It happened because the amount of oil available to buy suddenly dropped. This drop was mainly due to big changes happening in Iran during the Iranian Revolution.
Even though the world's oil supply only went down by about 4%, people became very worried. This widespread panic made the price of oil shoot up much higher than it should have.
Over the next year, the price of crude oil (raw oil) more than doubled. It went from around $14 a barrel to $39.50 a barrel. Just like in the 1973 oil crisis, long lines of cars started appearing at gas stations again. People waited for hours just to fill their tanks.
Contents
What Caused the 1979 Oil Crisis?
The main reason for the 1979 oil crisis was the Iranian Revolution. This was a major event where the government of Iran changed completely.
The Iranian Revolution's Impact
Before the revolution, Iran was a big oil producer. When the revolution began in 1978, oil workers in Iran went on strike. This meant they stopped working, and less oil was produced.
By early 1979, Iran's oil production had almost stopped. This caused a big gap in the world's oil supply. Even after the new government took over, oil exports from Iran were much lower than before.
How Did the World React?
When Iran's oil production dropped, other countries and oil companies got worried.
Panic and Hoarding
Many countries and companies started buying and storing more oil than they needed. They were afraid there wouldn't be enough oil later. This act of buying extra oil, called "hoarding," made the problem worse. It created an artificial shortage, pushing prices even higher.
OPEC's Role
The Organization of the Petroleum Exporting Countries (OPEC) is a group of major oil-producing nations. During this time, OPEC tried to manage the oil supply. However, the panic and hoarding made it hard to control prices. Some OPEC members also raised their oil prices, adding to the problem.
Effects of the Oil Crisis
The 1979 oil crisis had a big impact on people's daily lives and the world economy.
Higher Prices and Gas Lines
The most noticeable effect was the huge increase in gas prices. People had to pay a lot more to drive their cars. Gas stations often ran out of fuel, leading to long lines and frustration. In some places, people could only buy gas on certain days based on their license plate numbers.
Economic Slowdown
The high oil prices hurt businesses and economies around the world. It cost more to transport goods, run factories, and heat homes. This led to an economic recession in many countries, meaning less money was being spent and fewer jobs were available.
Energy Conservation Efforts
Governments and people started looking for ways to save energy. There were campaigns to encourage carpooling, using public transportation, and turning down thermostats. Car manufacturers began making more fuel-efficient cars.
Who Was Affected?
Many countries felt the effects of the 1979 oil crisis.
The United States
The United States was hit hard by the crisis. President Jimmy Carter tried to encourage energy saving. He also created the United States Department of Energy to help manage energy issues. The crisis made Americans think more about their reliance on foreign oil.
Other Countries
Countries in Europe and Japan also faced similar challenges. They had to deal with higher energy costs and economic slowdowns. The crisis showed how connected the world's economies were through oil.
Lessons Learned
The 1979 oil crisis, like the one in 1973, taught the world important lessons. It showed how much modern life depends on oil. It also highlighted the need for countries to find different sources of energy and to use energy more wisely.
Images for kids
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Fluctuations of OPEC net oil export revenues since 1972
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Line at a gas station in Maryland, United States, June 15, 1979.
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Gas coupon printed but not issued during the 1979 energy crisis
See also
In Spanish: Crisis del petróleo de 1979 para niños
