How the 1973 Oil Crisis Affected American Commercial Aviation

After the fourth Arab-Israeli war, the Organization of Arab Petroleum Exporting Countries (OAPEC) sought to use oil as a political and economic weapon. All in all, they sought to stop the supply of oil to any country helping Israel. Notably, the United States has provided Israel with weapons and equipment. As a result, OAPEC responded with a total oil embargo against the United States in October 1973, reducing the country’s oil supply by two million barrels a day and causing a crisis for the aircraft industry.


A significant leap

The Yom Kippur War lasted from October 6 to October 25, 1973. However, the embargo continued until the following year. As a result, the price of OPEC oil soared 400%. The price per barrel went from $3 to $12. The war and the ensuing embargo came as a shock to international aviation, particularly in the United States, which was already grappling with the challenges of the Vietnam War.

Authorities had to act quickly to ensure their industries could continue to operate. First, Congress passed the EPAA (Emergency Petroleum Allocation Act) to ensure that petroleum products, including jet fuel, would be fairly distributed throughout the country. This law was drafted before the embargo to address previous shortages, but garnered much more support as the fall was fully underway.

The focus was now on energy consumption. Companies have adopted several measures to save fuel. Actions such as waiting at the gate until take-off clearance was given were taken. Carriers have also reduced the use of auxiliary power units (APUs) and emphasized taxiing with fewer active engines.

Crews made sure to shut down engines during short layovers and revised fuel drain processes. Hull pressurization and frequent rigging also combined with center of gravity consideration to save an estimated 1.9 billion gallons of jet fuel in 1974 alone.

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Airlines wanted passengers and cargo to move efficiently. Photo: Getty Images

Additional measures

Route decisions also had to be made, with some carriers requesting temporary suspensions in parts of their network. The airlines also filed fuel-related capacity agreements that involved “estimated fuel savings of 329,000,000 gallons per year for domestic services and 59,000,000 gallons per year for international operations.”

Department of Transport and related agency appropriations for 1975 added that two measures further reduced the supply of domestic jet fuel.

“One was the ‘buy/sell’ program announced by the Federal Office of Energy on January 22, 1974, which provided for the reallocation of crude oil among refiners. Under this regulation, many of the major jet fuel suppliers were ordered to sell crude oil to refiners that did not and could not produce jet fuel. As a result, it was estimated that over 1,350,000 gallons of jet fuel, per day, were removed from the supply available to airlines. This program, which became effective February 1, 1974, continues until April 30, 1974. Another factor, effective February 8, 1974, was the Department of Defense tax on major middle distillate suppliers for the period from January 1, 1974 to June 30. , 1974. According to our best estimates, Department of Defense levies resulted in the removal of more than 1,900 million gallons of jet fuel from domestic supply during this period.

Aerial activity

The oil crisis caused a domino effect on the American aviation market. The likes of Pan American became dependent on high-priced foreign fuel, which added an estimated $200 million to the legacy carrier’s cost sheet in 1974. This factor, combined with other operational issues, caused a spiral top down for the airline until its early bankruptcy. 1990s.

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The embargo lasted between October 1973 and March 1974. Photo: Getty Images

It was not just the United States that felt the impact of the embargo. For example, Lufthansa had to cancel and merge several flights operated with its Boeing 727s. He noted that the situation was pushing manufacturers to produce more fuel-efficient jet engines. There was a drop of at least 6% in customers of the German national carrier in the year after the embargo was launched. Projects such as the Dassault Mercure also failed to make waves due to the harsh climate.

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The story repeats itself

Overall, airlines around the world are once again having to adjust to fuel supply challenges following another war involving a major supplier. Russia’s invasion of Ukraine has already seen fuel supply difficulties leading to delays and cancellations. Prices have also increased significantly, with surcharges expected to reach up to 15% this summer. Sanctions, airspace bans and socio-economic crises are wreaking havoc on the international spectrum.

There will undoubtedly be long-term consequences due to current conditions. Airlines were already looking for alternative fuel solutions before the invasion, but demand has now been catalyzed. The scaling up of electric and hydrogen-powered commercial aviation can be expected to happen sooner than expected, especially since these methods can rely on local ecosystems. Just as the 1973 crisis ignited an energy efficiency movement, leading to a change of direction for the industry for decades to come, the market could see another revolution in the years to come.

What do you think of the impact of the 1973 oil crisis? What do you think of the overall situation that has arisen? Let us know what you think in the comments section.

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