It is true that the cost of oil significantly rose during the 1970s. The catalyst for this price hike was the Yom Kippur War in which the West, and in particular the United States loaned their support to Israel in the form of supplies, funding and weapons. In response the OPEC nations resolved to up the price of oil and boycott the U.S and the West. There are a variety of reasons that contributed to this trend not continuing on through into the eighties.
- Alternative Energy
The Oil Embargo saw an urgency in the West to move away from oil towards other sources of energy such as investment in Nuclear Power, Natural Gas, Ethanol and Coal. The likes of wind energy and solar power were very much still in their infancy at this time.
- Oil Exploration
Perhaps due to the over reliance on OPEC at the time, further exploration was needed and so the boycott prompted an emphasis on the exploration and drilling in the Caucasus, Caspian Sea, Alaska and the North Sea.
- Arab-Israeli Disengagement
The end of the Yom Koppur War and eventual withdrawal of Israeli troops saw the Oil Embargo effectively end against the United States and other western countries.
- The Result
The embargo, having forced a need to find other energy sources and other sources of oil, saw the reliance on crude oil drop dramatically, therefore creating a surplus of oil reserves. This saw the price of oil drop almost half from the early 1980s to 1986.
