Oil—The Turbulent Years (1979–2001)
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The Iranian Revolution of 1979 was a momentous event for the region, for the world, and for oil markets. After months of popular demonstrations against his regime, the Shah left Iran, in large part to avoid massive fatalities. He did not want to unleash the military on his own people, which would potentially result in thousands of civilian fatalities. Many of the demonstrators had envisaged the birth of a democratic republic based on the Iranian Constitution of 1906. After all, Iran had been the first country in the Middle East and indeed in all of Asia to experience a constitutional revolution establishing a representative parliament. But it was not to be; Ayatollah Khomeini quickly filled the vacuum with his own version of supreme theocratic governance (velayat-e-faqih) and the Islamic Republic of Iran was born. Instead of a democratic republic, Iran got a theocracy, a theocracy that many of the Arab family rulers in the region, as well as the secular leader Saddam Hussein in Iraq, viewed (and continue to view) as an existential threat. The rhetoric coming out of Iran only widened the divide.
KeywordsSaudi Arabia Military Expenditure Economic Sanction OPEC Country Iranian Revolution
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- 1.For details, see A ska ri, Hossein, Conflicts and Wars: Their Fallout and Prevention (New York: Palgrave Macmillan, July 2011, Chapter 5).Google Scholar
- 4.For details on the size and budgetary burden of subsidies, see Askari, Hossein, Saudi Arabia: Oil and the Search for Economic Development (Northampton, MA: Edward Elgar Publishing, 1990).Google Scholar
- 5.See Al-Dukheil, A., Saudi Arabia Earnings and Expenditures: Financial Crisis in the Making (New York: Palgrave Macmillan, 2013).Google Scholar
- 7.International Energy Agency, World Energy Outlook 2012 (Paris: OECD/IEA, November 2012).Google Scholar