{"id":70788,"date":"2026-04-03T18:17:46","date_gmt":"2026-04-03T12:47:46","guid":{"rendered":"https:\/\/www.nextias.com\/ca\/?p=70788"},"modified":"2026-04-03T18:18:05","modified_gmt":"2026-04-03T12:48:05","slug":"energy-crisis-vs-1973-oil-crisis","status":"publish","type":"post","link":"https:\/\/www.nextias.com\/ca\/current-affairs\/03-04-2026\/energy-crisis-vs-1973-oil-crisis","title":{"rendered":"Comparative Analysis of Present Energy Turmoil and 1973 Oil Crisis"},"content":{"rendered":"\n<p><strong>Syllabus: GS3\/ Energy; GS2\/ International Relations<\/strong><\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Context<\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li>The ongoing conflict in West Asia has disrupted global oil supply, particularly through the Strait of Hormuz, drawing comparisons with the 1973 Oil Shock.<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>1973 Oil Crisis Vs Present Crisis<\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li>In 1973, the <strong>disruption was caused by coordinated action by Arab members <\/strong>of the Organization of Petroleum Exporting Countries and Organization of Arab Petroleum Exporting Countries.\n<ul class=\"wp-block-list\">\n<li>It involved production cuts and targeted embargoes against Western nations.<\/li>\n<\/ul>\n<\/li>\n\n\n\n<li>In contrast, the <strong>present crisis is driven by geopolitical conflict<\/strong> affecting a critical transit chokepoint rather than coordinated production cuts.<\/li>\n\n\n\n<li>The disruption stems from<strong> restricted shipping<\/strong> rather than deliberate supply reduction by producers.<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Similarities Between 1973 and the Present Crisis<\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Both crises are rooted in geopolitical conflicts in West Asia and supply disruptions have led to sharp increases in global oil prices.<\/li>\n\n\n\n<li><strong>Oil-exporting nations have leveraged their strategic position<\/strong> in global energy markets.<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Global Economic Impact<\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li>The 1973 crisis triggered stagflation, high inflation, low growth, and rising unemployment, in major economies.\n<ul class=\"wp-block-list\">\n<li>It led to deep recessions in the US, Europe, and Japan.<\/li>\n\n\n\n<li>The <strong>crisis exposed the vulnerability of oil-importing nations<\/strong> to external shocks.<\/li>\n<\/ul>\n<\/li>\n\n\n\n<li><strong>The current crisis<\/strong> has raised fears of stagflation, especially <strong>in developing economies<\/strong> heavily dependent on oil imports.<\/li>\n\n\n\n<li>Rising oil prices are increasing inflation, production costs, and food prices globally.<\/li>\n<\/ul>\n\n\n\n<p><\/p>\n\n\n\n<div class=\"wp-block-group has-background\" style=\"background-color:#fff2cc\"><div class=\"wp-block-group__inner-container is-layout-constrained wp-block-group-is-layout-constrained\">\n<p><strong>International Energy Agency (IEA)<\/strong><\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>IEA was created in 1974 in Paris, France as a direct response to the 1973-1974 oil crisis.<\/li>\n\n\n\n<li><strong>The IEA\u2019s founding members were<\/strong> Austria, Belgium, Canada, Denmark, Germany, Ireland, Italy, Japan, Luxembourg, The Netherlands, Norway, Spain, Sweden, Switzerland, T\u00fcrkiye, United Kingdom, and the United States.<\/li>\n\n\n\n<li><strong>Members: <\/strong>The membership was kept open only for OECD countries.\n<ul class=\"wp-block-list\">\n<li>There are now 33 full members with Colombia being inducted as 33rd members recently.<\/li>\n<\/ul>\n<\/li>\n\n\n\n<li><strong>Associate Members: <\/strong>In 2015, IEA opened the doors for non-OECD countries to become associate members.\n<ul class=\"wp-block-list\">\n<li>The associate members participate in the policy discussions and activities, but do not have decision-making rights.\u00a0<\/li>\n\n\n\n<li>India became an associate member in 2017. There are 13 associate members right now.<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<\/div><\/div>\n\n\n\n<p><\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Impact on India<\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li>India was not directly targeted by the embargo but was severely affected due to import dependence.<\/li>\n\n\n\n<li>The oil import bill rose sharply from <strong>$414 million in 1973<\/strong> to <strong>$1,350 million<\/strong> in <strong>1974.<\/strong><\/li>\n\n\n\n<li>The OPEC Countries refused to <strong>offer preferential pricing to India<\/strong> and the crisis worsened its balance of payments and triggered inflationary pressures.<\/li>\n\n\n\n<li>It<strong> pushed India to explore alternative energy sources<\/strong>, including coal gasification and offshore oil exploration (e.g., Bombay High).<\/li>\n<\/ul>\n\n\n\n<p><\/p>\n\n\n\n<div class=\"wp-block-group has-background\" style=\"background-color:#fff2cc\"><div class=\"wp-block-group__inner-container is-layout-constrained wp-block-group-is-layout-constrained\">\n<p><strong>India\u2019s Current Oil Imports<\/strong><\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>India imports <strong>nearly 88%<\/strong> of its crude oil requirements from around <strong>41 countries.<\/strong><\/li>\n\n\n\n<li>Roughly half of those supplies in February passed through the Strait of Hormuz.\n<ul class=\"wp-block-list\">\n<li>In February 2026, India received <strong>2.8 million bpd crude,<\/strong> accounting for 53% of total imports, from Iraq, Saudi Arabia, the United Arab Emirates, Kuwait and Qatar.<\/li>\n<\/ul>\n<\/li>\n\n\n\n<li>As of early 2026, <strong>Russia remains the largest supplier<\/strong> of crude oil to India, with Saudi Arabia and Iraq following closely as key suppliers.<\/li>\n<\/ul>\n<\/div><\/div>\n\n\n\n<p><\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Technological shift towards Coal Gasification<\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Coal gasification is the <strong>conversion of coal into synthetic gas (syngas) <\/strong>through high-temperature and high-pressure reactions.\n<ul class=\"wp-block-list\">\n<li>The process involves converting<strong> sulphur into hydrogen sulphide (H\u2082S) <\/strong>and removing impurities through chemical and physical treatment.<\/li>\n\n\n\n<li>The resulting clean gas can be used for domestic fuel, industrial applications, and power generation.<\/li>\n<\/ul>\n<\/li>\n\n\n\n<li>Globally, coal gasification was used for <strong>\u201ctown gas\u201d supply in Europe and the United States<\/strong> in the early 20th century.<\/li>\n\n\n\n<li><strong>From Town Gas to IGCC:<\/strong> With technological advancement, the focus shifted from town gas to Integrated Gasification Combined Cycle (IGCC).\n<ul class=\"wp-block-list\">\n<li>IGCC combines gasification with power generation using gas and steam turbines, improving efficiency.<\/li>\n\n\n\n<li><strong>Bharat Heavy Electricals Limited<\/strong> contributed to India\u2019s first IGCC plant in <strong>1985.<\/strong><\/li>\n<\/ul>\n<\/li>\n<\/ul>\n\n\n\n<p><\/p>\n\n\n\n<div class=\"wp-block-group has-background\" style=\"background-color:#ebecf0\"><div class=\"wp-block-group__inner-container is-layout-constrained wp-block-group-is-layout-constrained\">\n<p><strong>National Coal Gasification Mission<\/strong><\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>India launched the National Coal Gasification Mission in<strong> 2021 <\/strong>to enhance energy security and reduce import dependence.\n<ul class=\"wp-block-list\">\n<li>It aims to reduce dependence on imported natural gas, methanol, and ammonia.<\/li>\n<\/ul>\n<\/li>\n\n\n\n<li>The mission targets gasification of <strong>100 million tonnes of coal by 2030.<\/strong><\/li>\n\n\n\n<li>Investments worth \u20b985,000 crore have been committed to promote clean coal technologies.<\/li>\n\n\n\n<li>Coal India Limited and BHEL have formed <strong>Bharat Coal Gasification &amp; Chemicals Limited <\/strong>to advance the sector.<\/li>\n<\/ul>\n<\/div><\/div>\n\n\n\n<p><\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Concluding remarks<\/strong><\/h3>\n\n\n\n<ul class=\"wp-block-list\">\n<li>While the 1973 Oil Shock and the current crisis share similarities in geopolitical origins and inflationary impact, the present disruption is larger in scale but structurally different.<\/li>\n\n\n\n<li>The global economy is better prepared today with diversified energy sources and strategic reserves, yet vulnerabilities persist, especially in developing nations.<\/li>\n\n\n\n<li>Long-term energy security requires reducing dependence on volatile regions while accelerating the transition to sustainable energy sources.<\/li>\n<\/ul>\n\n\n\n<p><strong>Source: <\/strong><a href=\"https:\/\/www.thehindu.com\/sci-tech\/science\/west-asia-war-syed-husain-zaheer-rrl-national-gas-grid\/article70758449.ece\" target=\"_blank\" rel=\"noopener\"><strong>TH<\/strong><\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p><strong> Context <\/strong><\/p>\n<li class=\"ms-5\"> The ongoing conflict in West Asia has disrupted global oil supply, particularly through the Strait of Hormuz, drawing comparisons with the 1973 Oil Shock. <\/li>\n<p><\/p>\n<p><strong> 1973 Oil Crisis Vs Present Crisis <\/strong><\/p>\n<li class=\"ms-5\"> In 1973, the disruption was caused by coordinated action by Arab members of the Organization of Petroleum Exporting Countries and Organization of Arab Petroleum Exporting Countries. <\/li>\n<li class=\"ms-5\"> It involved production cuts and targeted embargoes against Western nations. <\/li>\n<li class=\"ms-5\"> In contrast, the present crisis is driven by geopolitical conflict affecting a critical transit chokepoint rather than coordinated production cuts. <\/li>\n<p><a href=\" https:\/\/www.nextias.com\/ca\/current-affairs\/03-04-2026\/energy-crisis-vs-1973-oil-crisis \" class=\"btn btn-primary btn-sm float-end\">Read More<\/a><\/p>\n","protected":false},"author":4,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[21],"tags":[],"class_list":["post-70788","post","type-post","status-publish","format-standard","hentry","category-current-affairs"],"acf":[],"jetpack_featured_media_url":"","_links":{"self":[{"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/posts\/70788","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/users\/4"}],"replies":[{"embeddable":true,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/comments?post=70788"}],"version-history":[{"count":2,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/posts\/70788\/revisions"}],"predecessor-version":[{"id":70790,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/posts\/70788\/revisions\/70790"}],"wp:attachment":[{"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/media?parent=70788"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/categories?post=70788"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/tags?post=70788"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}