The oil crisis began on October 16, 1973, when the Arab members of OPEC announced a large rise in the posted price of oil, and the following day an embargo on shipments to the United States and the Netherlands, the countries seen as the backers of Israel in the war that was then being fought. The moves were an act of war by other means. Within a few months the price of oil had roughly quadrupled, and the industrial economies were sliding into the first recession they had known since the war.
The decision was political. Egypt and Syria had attacked Israel on October 6, and the Arab oil states, led by Saudi Arabia, chose the moment when the West was most dependent on their exports to turn the tap, using oil as a weapon to force a change of policy. The embargo and the price rise came from the same meeting in Kuwait, and they were aimed at the United States and its allies with a directness that no producer had used before.
The effect ran through everything. Motorists queued for petrol. Speed limits were cut. Factories went on short time, and the long post-war boom, built on oil that cost almost nothing, came to an end. The importing countries had built their economies on the assumption that energy would stay cheap, and when it did not, inflation and unemployment rose together, a combination the economists of the time had no ready answer for.
The world that came out was different. It stayed different. The importing states set up the International Energy Agency to coordinate against a repeat, the producing states took control of their own resources, and the balance of money shifted toward the Gulf, where the revenues of the oil states grew beyond anything they had known. Cheap oil did not come back in the same way, and the crisis of 1973 is still the line that separates the post-war economy from the one that followed.