Bohanon remembers an evening flight into the United Arab Emirates a decade ago. Looking out his window, he saw the outline of a body of water bordered by land on both sides. The distance between the land narrowed in the middle of the view. On the water, dozens of individual bright lights moved slowly, keeping approximately even distance from one another and clustered around the narrowest point. It dawned on him: He was looking at the Strait of Hormuz. Those lights were tankers supplying the world with petroleum. He recalls thinking: “This is the choke point of the world economy. Shut this down, world economic crisis.”  

That crisis is unfolding now. Even after catastrophic losses, Iran retains enough military capacity to shut the Strait down while US and Israelis leaders scramble to secure safe passage for shipping. The vulnerability is well known: roughly 20% of the world’s oil supply moves through the narrow 20-mile passage. Since February 27th, the day before the US-Israeli air campaign began, the price of Brent crude rose from $72 per barrel to $103 by March 16th, briefly spiking to nearly $120 on March 9th.  

We are old enough to remember the 1973 oil crisis. On October 6, 1973, Egypt and Syria launched a large-scale surprise attack on Israel, starting the Yom Kippur War. Ten days later, the Organization of Arab Petroleum Exporting Countries (OPEC) raised oil prices from $3.01 a barrel to $5.12 a barrel, an increase in percentage terms somewhat larger than the current price spike.  

After the Yom Kippur War ended, oil prices continued to rise. On January 1, 1974, OPEC and Iran announced a new, higher price of $11.65 a barrel and cut production by an amount sufficient to support the price hike. From pre-war levels, this was a staggering 287% increase, and higher prices persisted for the next few years. If oil were to rise today by the same proportion, a barrel would cost $278. 

The oil shock of 1973–74 is widely seen as triggering the worst recession since World War II and introducing the phenomenon of stagflation. While gasoline price controls were supposed to offset recessionary pressures, they likely exacerbated them.  Although the nations in today’s drama are not aligned as they were in 1973, the story is eerily familiar.