The oil crisis of the 1970s had a tremendous political, social, and economic impact on the United States, and its reverberations continue to be felt to this day. This event dramatically illustrated American dependence on fossil fuels, and raised a lot of questions about the country's energy policy and the security of its energy supply.
Several events combined to bring about the energy crisis of the '70s. The first was a dramatic rise in energy consumption, with the United States consuming a huge percentage of the world's energy in proportion to its population. Domestic oil production declined at the same time, leading the country to lean heavily on foreign oil, and in 1973, the US was placed under an OPEC embargo for political reasons. Middle Eastern members of OPEC wished to protest American involvement in an ongoing conflict with Israel, and these nations struck the country where it hurt, depriving them of oil in 1973 and again in 1977.
One of the most immediate effects of the embargo was skyrocketing energy prices as a result of limited supply and heavy demand. Rationing went into effect, with supplies of petroleum products being carefully doled out with ration cards and flag systems, in which people could take turns buying gas and other fuels on the basis of license plate numbers. At the same time, the stock market contracted radically, an event that foreshadowed future stock market instabilities linked to the price of oil.
The 1970s was also an era in which environmentalism was becoming mainstream. Environmentalists went from what many considered the "lunatic fringe" to the heart of social consciousness as they argued that high energy consumption was damaging the environment and crippling the United States. The energy crisis, combined with more interest in environmentalism, brought about a rise in interest in alternative sources of energy and fuel efficiency.
Politically, the government struggled to deal with the crisis. The Watergate scandal erupted at about the same time, making it difficult for the Nixon administration to make productive policy decisions. Once Ford and later Carter took over, they struggled to make sense of the problem. A number of government agencies, including the Department of Energy, were founded during this period in an attempt to formulate policy and shift the way in which Americans used energy.
A national 55 mile per hour (90 kilometers per hour) speed limit was imposed to increase fuel efficiency, and daylight saving time was moved to reduce demand for fuel. These imposed austerity measures fed into a more general examination of US energy policy, with some Americans protesting such measures under the argument that they infringed on the rights of the people or posed undue hardship.
One of the most far-reaching effects of the energy crisis was a growing awareness of the need to secure the nation's energy supplies. Concerns about energy led the United States to become heavily involved in Middle Eastern politics, since it feared a repeat of the 1970s embargoes, and the country also started more aggressive oil and gas exploration within its boundaries in an attempt to increase domestic production. This period in American history highlighted the fact that energy was a critical political issue, and that the United States could not afford to be caught unaware in the future.