Rüdiger Graf. Oil and Sovereignty: Petro-Knowledge and Energy Policy in the United States and Western Europe in the 1970s. New York: Berghahn Books, Incorporated, 2018. 474 pp. $130.00 (cloth), ISBN 978-1-78533-806-9.
Reviewed by David S. Painter (Georgetown University)
Published on H-Diplo (December, 2019)
Commissioned by Seth Offenbach (Bronx Community College, The City University of New York)
In this deeply researched and creatively conceived study German historian Rüdiger Graf examines how Western nations, in particular the United States and West Germany, responded to the threat that the 1973-74 oil crisis posed to their national sovereignty. This work is an excellent complement to Christopher R.W. Dietrich’s Oil Revolution: Anticolonial Elites, Sovereign Rights, and the Economic Crisis of Decolonization (2017). Dietrich’s work analyzes how concerns about sovereignty were a key factor in efforts by anticolonial elites, including the leaders of the major Third World oil producers, to gain control of their natural resources. Graf’s work adds an analysis of the creation of “petro-knowledge,” which he defines as energy-related knowledge produced and used by governments and private organizations.
Originally published in German in 2014, Oil and Sovereignty is a very valuable addition to the international history of the 1970s. According to the author, the bulk of the research was completed in 2012, though the English translation includes a few citations to significant sources that became available subsequently. The research is very impressive: the fifty-page bibliography lists eight archives in four countries (the United States, Germany, the United Kingdom, and France); online and printed collections of primary sources; and a wide range of secondary sources in English, German, and French. The bibliography and 1,660 endnotes provide an unmatched guide to sources on the history of the oil crisis.
The first chapter sets the scene by briefly examining the structure of the post-World War II oil industry and the growing importance of oil to economic life in the United States, Western Europe, and Japan. Although Graf provides some statistics on the magnitude of the shift to oil—between 1949 and 1972 energy use tripled, with oil making up the largest share of the increase—it would have been useful to have this information presented in tables, as in the classic article by Joel Darmstadter and Hans H. Landsberg. Graf also looks at how oilmen saw and portrayed themselves and their industry, and briefly discusses the people and institutions engaged in the business of developing and deploying knowledge about the industry.
In the next chapter, which examines the 1970-73 period, Graf argues that Western leaders were not surprised when the October 1973 Arab-Israeli War led the Organization of Arab Petroleum Exporting Countries (OAPEC) to cut production and exports and to impose an embargo on exports to the United States, the Netherlands, and Portugal in response to their military assistance to Israel. The Western industrial countries had long been aware of their growing vulnerability to politically inspired oil supply disruptions, and in January 1970, the US representative to the Organization of Economic Cooperation and Development Oil Committee (OECD) informed his colleagues of the impending loss of US surplus capacity, which had helped mitigate the impact of previous supply disruptions in 1956 and 1967.
Drawing on his perceptive 2012 Diplomatic History article, Graf provides a detailed account of the course of the 1973-74 oil crisis and tries to find middle ground between those who deny and those who exaggerate its importance. Although the drop in oil supplies was not as great as feared and did not last as long as feared, and although the oil companies were able to mitigate the impact of the embargo against the United States and the Netherlands by redirecting available Arab and non-Arab oil supplies, there was a drop in world oil availability, and redirecting oil supplies was costly. Similarly, although OAPEC ended the embargo and production cuts without achieving its initial demand that Israel withdraw from the territories it had occupied in 1967, OAPEC’s actions ensured that the United States and its allies could no longer ignore Arab concerns, not least because the crisis led to a sharp increase in world oil prices from around $3.00 a barrel before the crisis to around $11.65 by the end of the year (p. 4).
The United States, Western European countries, and Japan viewed higher oil prices and dependence on oil imports as threats to their sovereignty. Chapter 4 examines how the Richard Nixon administration, which was under fire because of the unfolding Watergate affair, sought to demonstrate its capacity for effective action by expanding and centralizing power over energy policy and developing government expertise on oil and energy policy. Domestically, this took the form of declaring the objective of achieving energy independence by the end of the decade and putting energy policy in the hands of energy “czar.” Internationally, Secretary of State Henry Kissinger sought to counter Arab demands that the United States pursue a more evenhanded policy in the Arab-Israeli conflict. Kissinger also sought to use the crisis to regain and enhance US leadership of the Western alliance.
Whereas US leaders saw the oil crisis as a threat to US leadership of the Western alliance, West German leaders feared that the economic problems caused by the crisis could undermine the legitimacy of German democracy, which depended, in part, on economic growth and prosperity. The issue of sovereignty took on a different form in West Germany, which lacked major international oil companies and significant domestic oil production. German leaders were also restrained by the nation’s recent historical experience, and therefore looked to secure national sovereignty within an international framework. Although somewhat more reluctant than the other major consuming countries to interfere in markets, West German energy policy echoed OECD policy and focused on energy-saving measures, establishment of stockpiles, diversification of energy sources, and diversification of source countries. Graf also points out that the oil crisis gave added impetus to Ostpolitik, since oil and gas imports from the Soviet Union could enhance energy security as well as promote détente.
Although various international conferences dealt with oil and energy issues in the 1970s, Graf argues that the concept of national sovereignty was not displaced by international cooperation. Instead, countries, and especially the United States, used international organizations to promote their national interest and sovereignty. Drawing on extensive research in the records of the Federal Foreign Office (Ministry of Foreign Affairs) and other sources, Graf provides a nuanced analysis of the Washington Energy Conference of 1974 and the subsequent negotiations that led to the establishment of the International Energy Agency. While European nations recognized that the United States was using the energy crisis to reassert its leadership of the Western alliance, most, with the significant exception of France, wished to avoid a confrontation with the United States over energy. Graf also details how the Europeans and Japan joined the United States in successfully opposing Third World efforts to use oil as a model for the creation of a New International Economic Order.
In an especially rich chapter entitled “Petro-Knowledge, the Perception of Limits and Sovereignty,” Graf traces debates over the oil crisis among political, economic, and social scientists and show how they structured understanding of efforts by Western governments to meet the challenges to their sovereignty arising out of the oil crisis. In addition to the “usual suspects” involved in the US debate, Graf includes discussion of the debate in West Germany. Prominent themes included the impact of multinational corporations on national sovereignty, changes in the oil market and their impact on foreign policy priorities and power relationships, whether North-South conflict over resources was superseding the bipolar Cold War order as the main focus of international relations, and the rising importance of transnational processes and organizations. The oil crisis led to an expansion of the concept of national security to include economic and social as well as military issues and consideration of the security of citizens as well as the state, a focus on global issues, and an expansion in the categorization of threats. The new focus on energy also led to consideration of energy constraints on development and of the ecological limits to growth, and to the emergence of energy and ecological economics as important and sharply contested subfields.
In the conclusion, Graf argues that the oil crisis led to the three “crucial discursive shifts” in how scholars understood international relations: the concept of security expanded to encompass economic and social dimensions as well as strategic and military dimensions; new concerns arose about the consequences of global economic interdependence for national sovereignty; and a global environmental movement emerged. All of these shifts were underway before 1973, but the oil crisis accelerated them. Graf’s use of the concepts of sovereignty and petro-knowledge enriches our understanding not only of the oil crisis of 1973-74 but also of some of the most important developments in contemporary history. Among its many strengths, Oil and Sovereignty demonstrates the benefits of a comparative as opposed to a purely national perspective. Every serious scholar of oil and international relations should study this exemplary work and engage its arguments.
. Rüdiger Graf, Öl und Souveränität: Petroknowledge und Energiepolitik in den USA und Westeuropa in den 1970er Jahren (Berlin: Walter de Gruyter, 2014). Although the text generally reads well, the translator repeatedly mistranslates Kohlenwasserstoffe (hydrocarbons) as carbohydrates.
. On international oil in the 1950s and 1960s, see Edith T. Penrose’s still unsurpassed The Large International Firm in Developing Countries: The International Petroleum Industry (London: George Allen and Unwin, Ltd., 1968).
. Joel Darmstadter and Hans H. Landsberg, “The Economic Background,” in The Oil Crisis, ed. Raymond Vernon (New York: W. W. Norton, 1976), 15-37; appendix B in The Oil Crisis, 290.
. Rüdiger Graf, “Making Use of the Oil Weapon: Western Industrial Nations and Arab Petropolitics in 1973-74,” Diplomatic History 36 (January 2012): 185-208.
. See the discussion in David S. Painter, “Oil and the October War,” in The October 1973 War: Politics, Diplomacy, Legacy, ed. Asaf Siniver (London: Hurst & Company, 2013), 187-91. (The US edition, published by Oxford University Press, is titled The Yom Kippur War: Politics, Diplomacy, Legacy.)
. Salim Yaqub, “The Weight of Conquest: Henry Kissinger and the Arab-Israeli Conflict,” in Nixon in the World: American Foreign Relations, 1969-1977, ed. Fredrik Logevall and Andrew Preston (New York: Oxford University Press, 2008), 227-48.
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