So you think you understand why the energy crisis of the 1970s occurred? That it was all due to the Iranian overthrow of the Shah?
Few people, even today, seem to understand some basic facts:
- US domestic oil production peaked in 1971
- US gasoline deliveries were subject to allocation controls which dated back to WW2. These controls favored farmers and rural areas over urban drivers, resulting in a situation where local shortages were likely to occur.
- When drivers panicked and starting keeping their tanks topped off, the total amount of gasoline kept in those tanks increased dramatically, since in normal times people only keep their tanks about half full. This in itself exacerbated the situation – in other words, individual reactions to a feared shortage actually helped create the shortage.