Americans rationed gas during WWII and the 1970s oil shocks. Will that happen in ‘Putin’s war’?
- Americans will continue to pay escalating gas prices as the US targets Russia’s economy by banning oil imports.
- Today's prices remind many Americans of the 'oil shocks' of the 1970s when crude oil prices surged.
- But unlike the 70s, today there's a greater push - and likelihood - for a renewable future, an expert says.
At 14 years old, Betty Heuser used to stand in line for what seemed like an eternity to collect gasoline ration cards for her father during World War II.
"It was a pain in the you-know-where," Heuser recalled. "You couldn't really go anywhere except back and forth to work because you didn't have enough gas."
Three decades later, Heuser again found herself waiting in "excruciating" lines – this time at the gas pump. During the oil shocks of the 1970s, Heuser took each of the two family cars to get filled up once a week while her husband was at work, waiting an hour to an hour-and-a-half each time – even longer on the weekends.
"The worst thing that could happen to you is you waited all that time and, when you got to the gas pump, they were out of gas," she said.
Heuser watched as gas prices surged again during the 2008 financial crisis, then experienced the plunging price of crude oil during the coronavirus pandemic. And, now, Heuser, 95, is seeing gas prices reach record highs.
"I feel sorry for people who have to go to work and will have to drive," she told USA TODAY. "And it's not only the gas prices. We need fuel for practically every single thing we use."
Propelled by the highest inflation in 40 years and Russia's war in Ukraine, gas prices are the most expensive in U.S. history, not accounting for inflation. President Joe Biden on Tuesday announced a ban on the U.S. import of all Russian energy products to target "the main artery of Russia’s economy." But he warned there will be costs at home.
"Putin’s war is already hurting American families at the gas pump," he said, adding, "I’m going to do everything I can to minimize Putin’s price hike here at home."
Some Americans told USA TODAY they have already started canceling road trips, carpooling, giving up side gigs, walking to work, streamlining errand runs and doing more shopping online to cut down on driving.
In a report this week, Goldman Sachs strategists warned the war in Ukraine could result in the fifth largest one-month disruption in global commodities markets since World War II.
"The last two weeks have seen the sharpest change to global commodities markets since the 1973 oil embargo," Goldman Sachs said Friday.
The 1970s oil shocks and odd-even rationing
Prior to the 1970s, American energy prices had generally remained steady throughout much of the 20th century, said Meg Jacobs, a research scholar in the Princeton School of Public and International Affairs.
"No one ever expected that to change, and when it changed, it changed really rapidly," Jacobs said.
Oil prices surged in 1973 and 1979 in what were known as the first and second "oil shocks." The first was triggered in October 1973, when Arab state members of the Organization of Petroleum Exporting Countries imposed an embargo targeting countries that supported Israel in the Yom Kippur War.
"OPEC wanted to punish the West for their support of Israel in the conflict, and sharply reduced the export of oil. This caused oil prices to spike rapidly, causing both inflation and recession in most richer Western countries," said Gabriel Mathy, an assistant professor of economics at American University.
Some described the embargo as an "energy Pearl Harbor," Jacobs said.
"It came with that level of shock and awe," she said.
In response, President Richard Nixon announced plans to increase domestic energy production and conservation. Congress passed laws imposing a national speed limit of 55 mph and year-round daylight saving time. And, in several states, odd-even rationing at gas stations was instituted, meaning consumers could fill up on either odd or even days based on the last digit of their license plate.
"Soaring energy prices really cemented in Americans minds their vulnerability in a way that they hadn't experienced before," Jacobs said.
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The U.S. also implemented a complicated set of crude oil price controls and allocation limitations that created chaos in the market, said R. Tyler Priest, an associate professor of history and geography at the University of Iowa.
In 1975, Congress passed the Energy Policy and Conservation Act that created the Strategic Petroleum Reserve. But long lines and odd-even rationing returned several years later, when the Iranian Revolution triggered a drop in oil production.
"I think the main thing that we can learn from the 1970s experience is that Americans really don't like high gas prices. It really unsettles them in a way that few other things do," Jacobs said.
The energy crises prompted a push in the U.S. to develop more oil and gas resources and open up more areas of the Outer Continental Shelf for offshore leasing and drilling, Priest said.
They also contributed to the undoing of both Nixon and President Jimmy Carter, Jacobs said. That's why Biden is making an effort to "shift blame away from him" by calling the surging prices "Putin's price hike," Jacobs said.
"He knows how vulnerable he is as the American president with rising gas prices," she said.
More in line with World War II-era rhetoric, Biden has made a "Roosevelt-style" appeal to Americans to combat Russian President Vladimir Putin's attack on Ukraine through economic hardship, Jacobs said.
"The story of World War II is a very different story. It's a story of patriotic sacrifice, of collective mobilization, of Franklin Roosevelt mobilizing the homefront as a way supporting our troops abroad and rebranding sacrifice as the price to pay to save democracy," she said.
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Biden, similarly, has characterized Americans' necessity to pay higher prices as being part of a larger struggle between democracy and autocracy, Jacobs said.
"At some point, he's going to actually have to deliver," she said. "So the question is, how far is he willing to go to try to do something about prices? Is he willing to go all the way to sort of World War II-type price controls on oil and gas?"
"Rationing received almost the same kind of support in the 1940s," Jacobs said.
Is the US on 'the verge' of a renewable future?
Ramanan Krishnamoorti, a professor of petroleum engineering at the University of Houston, said he wouldn't draw parallels to the oil shocks of the 1970s. The U.S. is now more energy-independent and has a multitude of suppliers, he said. Gasoline also comprises a smaller amount of overall consumer spending.
"I think we're in a very different place in history," Krishnamoorti said. "The one analogy I would draw is what we saw in terms of a run-up in prices in 2008, where we saw a very tight supply and rapidly increasing demand that caused the prices to increase very sharply, and what followed was a global recession."
Krishnamoorti said he's most concerned about what another recession would mean for sustainability efforts worldwide.
"If we are stuck with another global recession, it is going to potentially impact a lot of things that have happened over the last five to ten years in terms of the sustainability paradigm that we've all been trying to push forward – all of these energy transition issues, all of the significant focus on climate change," he said. "Much of that is perhaps going to get walked back, and that is perhaps the biggest travesty."
Just as happened in the 1970s, the U.S. is already seeing a renewed push for increased fossil fuel production domestically, Priest said.
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"It shows you how utterly dependent we are on oil and natural gas, still, despite years of trying to implement policies to decarbonize our economy," he said.
Some lawmakers, activists and administration officials have pointed to the current crisis as proof of the need for the U.S. to move away from fossil fuels. In his address from the White House's Roosevelt Room on Tuesday, Biden said the crisis "should motivate us to accelerate the transition to clean energy."
Amos Hochstein, the State Department's energy envoy, echoed Biden at an energy conference in Houston this week.
"This conflict has made it clear to us that we should double-down and triple-down on the transition, and to make it broader, bigger and faster," he said.
While the U.S. did not capitalize on the oil shocks of the 1970s to push for a renewable future, there's room for such a push now, Jacobs said.
"We really have an opportunity to use this as a moment to shore up our resolve," she said. "Unlike in the 1970s, where these were kind of pipe dreams, we're really on the verge of a sort of renewable future."