ABSTRACT
In October 1973 the OPEC oil crisis hit the world economy when oil-producing countries unilaterally decided to triple, and then further increase, the price of oil sold to consuming countries. This act represented the first time that a group of primary-producing countries had acted in concert, as a cartel, to determine the termsof-trade of a strategic commodity worldwide. The act had two immediate effects. First, in consuming countries it created a supply shock, shortages and long queues at filling stations, exposing the vulnerability of rich, industrialized countries of the North to the actions of primary-producing countries of the South, generating fears of more ‘producer cartels’ (Bergsten and Krause eds 1975; Bergsten 1976). Second, in the South, it led to calls for the new economic international order (NEIO), suddenly empowering the G7 countries in the United Nations Conference on Trade and Aid (UNCTAD). UNCTAD, originally created in 1964 in the spirit of ‘trade, not aid’, was expected to counter GATT, the General Agreement on Tariffs and Trade, which was generally perceived as a rich man’s club (Walters 1973).
