MIDDLE EAST HISTORY IT HAPPENED IN OCTOBER: Nixon Administration Ignores Saudi Warnings, Bringing On Oil Boycott
It was 24 years ago, on Oct. 20, 1973, that Saudi Arabia announced it was imposing a total oil boycott against the United States in retaliation for its support of Israel during the October war. The action caused an economic earthquake around the world.(1) Suddenly Americans and others were forming long lines at gas stations, and the greatest transfer of wealth in world history began. The price of gasoline soared, briefly up tenfold. It was a devastating added cost for governments, corporations and families.
The embargo, Henry A. Kissinger later admitted, had "the most drastic consequences" for the United States, adding, "It increased our unemployment and contributed to the deepest recession we have had in the postwar [World War II] period."(2) What Kissinger failed to say was that he bore major responsibility for the boycott.
The boycott could not have come as a surprise, as so many U.S. officials of the period have pretended. Since the beginning of 1973, Saudi Arabia's King Faisal ibn Abdul Aziz had been warning the Nixon administration with increasing urgency that he would employ the oil weapon unless Washington forced Israel to return Arab land it had been occupying since 1967. As guardian of Islam's holy sites, Faisal was particularly perturbed that Israel continued to occupy the Haram Al-Sharif with the Al Aqsa and Dome of the Rock mosques in Arab East Jerusalem. Haram Al-Sharif is the third holiest site, after Mecca and Medina, to the world's one billion Muslims.
Faisal, a proud and pious man, knew Egypt and Syria were planning war if Israel did not end its occupation. He thought war might be averted and Arab rights restored if he could influence President Richard Nixon to moderate U.S. support of Israel. In April the king sent one of his top aides, Oil Minister Ahmad Zaki Yamani, to Washington to warn officials of his seriousness about imposing an oil boycott.(3)
Among other Nixon officials, Yamani met with Kissinger, who at the time was the national security adviser in the White House. Instead of heeding Yamani, however, Kissinger strongly advised the Saudi not to mention the threat of an oil boycott to anyone else because it would make the Saudis look domineering and extreme. Kissinger was outwardly disturbed when Yamani informed him he had already talked with some officials, including Treasury Secretary George P. Shultz.
Nonetheless, Kissinger said, Yamani should not repeat his threat. The Saudi suspected that Kissinger's Jewishness prevented him from being impartial on Middle East matters and believed Kissinger was trying to keep the facts from the American people. Yamani continued to voice the king's message, including granting an interview to The Washington Post. He pointed out to the newspaper that the West was pressing Saudi Arabia to increase its oil production up to 20 million barrels a day from its current 7.2 million. Yamani said: "We'll go out of our way to help you. We expect you to reciprocate."(4)
"You may lose everything. Time is running out."
The Post was no more impressed by the Saudi message than Kissinger. On April 20, the Post editorially criticized the Saudis for threatening an oil boycott and added that "it is to yield to hysteria to take such threats as Saudi Arabia's seriously."(5)
Faisal was so disturbed by the U.S. rejection of his message that he granted for the first time in his life an interview to American TV. He warned: "America's complete support of Zionism against the Arabs makes it extremely difficult for us to continue to supply U.S. petroleum needs and even to maintain friendly relations with America."(6)
Israel was particularly active in encouraging Washington to ignore Faisal. Foreign Minister Abba Eban asserted that there was not "the slightest possibility" of an oil boycott. He added: "The Arab states have no alternative but to sell their oil because they have no other resources at all. …