The new leadership under Ayatollah Khomeini initially halted production, and existing fields began to suffer from a lack of maintenance and investment. The Iranian Revolution: The Spark in the Dry Powder The primary ignition point for the 1979 crisis was the Islamic Revolution in Iran.
OPEC Power Shift Amid the 1979 Oil Crisis
This second oil shock of the 1970s was not merely a supply disruption; it was a catalyst that reshaped geopolitics, monetary policy, and the daily rhythm of life for millions across the globe. Governments implemented odd-even rationing schemes, where vehicles could only purchase fuel on specific days based on license plate numbers.
The 1979 shock dealt a severe blow to recovery efforts across the United States and Europe. The Mechanics of the Shock: Prices and Panic As Iranian exports ground to a halt, the price of Brent crude more than doubled within a matter of months, climbing from around $13 in early 1979 to over $30 by 1980.
OPEC Power Shift Amid the 1979 Oil Crisis
Central banks, led by the Federal Reserve under Paul Volcker, responded with aggressive interest rate hikes in an attempt to crush inflation. The era of cheap energy was abruptly over, forcing a reckoning with suburban sprawl and car-dependent lifestyles that had defined the post-war period.
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