A Prelude to the Foundation of Political EconomyWorld Oil and the Crisis of Globalization
A Prelude to the Foundation of Political Economy: World Oil and the Crisis of Globalization
Bina, Cyrus
2015-10-13 00:00:00
[The oil crisis of 1973–74 was the symptom of the underlying fundamental changes that forcefully led to the internationalization of the oil industry. The production and pricing of crude oil associated with the various oil-producing regions of the world have since become part of a unified process through global competition. It was a mother of all crises that led to the restructuring of all oil, thus brought cheap and not so cheap oil under one all-inclusive, globalized market. This prompted the collapse of the International Petroleum Cartel (1928–72); this included the intricate basing-point pricing system at the Gulf of Mexico and the Persian Gulf, and what lingered as the institutional wherewithal and purposeful paraphernalia linked to the cartel’s success. In the meantime, the “Postwar Petroleum Order”—an indispensable part of the international order of the Pax Americana (1945–79)—had begun to fall by the wayside, and the umbilical cord of the US foreign policy was cut from cartelized oil for good. The crisis appeared as a faint signal at first. This prompted the United States and its habitual Western alliance, and the titans of the International Petroleum Cartel (IPC), to engage in an old mode of diplomacy and negotiation to find a customary solution.]
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A Prelude to the Foundation of Political EconomyWorld Oil and the Crisis of Globalization
[The oil crisis of 1973–74 was the symptom of the underlying fundamental changes that forcefully led to the internationalization of the oil industry. The production and pricing of crude oil associated with the various oil-producing regions of the world have since become part of a unified process through global competition. It was a mother of all crises that led to the restructuring of all oil, thus brought cheap and not so cheap oil under one all-inclusive, globalized market. This prompted the collapse of the International Petroleum Cartel (1928–72); this included the intricate basing-point pricing system at the Gulf of Mexico and the Persian Gulf, and what lingered as the institutional wherewithal and purposeful paraphernalia linked to the cartel’s success. In the meantime, the “Postwar Petroleum Order”—an indispensable part of the international order of the Pax Americana (1945–79)—had begun to fall by the wayside, and the umbilical cord of the US foreign policy was cut from cartelized oil for good. The crisis appeared as a faint signal at first. This prompted the United States and its habitual Western alliance, and the titans of the International Petroleum Cartel (IPC), to engage in an old mode of diplomacy and negotiation to find a customary solution.]
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