structural:scholar_edition
Impact on United States

In the US production, distribution and price disruptions "have been held responsible for recessions, periods of excessive inflation, reduced productivity, and lower economic growth." Some researchers regard the 1973 "oil price shock" and the accompanying 1973–74 stock market crash as the first discrete event since the Great Depression to have a persistent effect on the US economy.

The embargo had a negative influence on the US economy by causing immediate demands to address the threats to U.S. energy security. On an international level, the price increases changed competitive positions in many industries, such as automobiles. Macroeconomic problems consisted of both inflationary and deflationary impacts. The embargo left oil companies searching for new ways to increase oil supplies, even in rugged terrain such as the Arctic. Finding oil and developing new fields usually required five to 10 years before significant production.

The average US retail price of a gallon of regular gasoline rose 43% from 38.5¢ in May 1973 to 55.1¢ in June 1974. State governments asked citizens not to put up Christmas lights. Oregon banned Christmas and commercial lighting altogether. Politicians called for a national gasoline rationing program. Nixon asked gasoline retailers to voluntarily not sell gasoline on Saturday nights or Sundays; 90% of gas station owners complied, which produced long lines of motorists wanting to fill up their cars while they still could.

The "oil shock" provided considerable impetus to the American nuclear industry as a way to achieve "energy independence" from the Middle East. On 7 November 1973, Nixon in an address to Congress called for Project Independence to make the United States self-sufficient in energy by 1980, which called for a massive investment in the nuclear industry. Nixon seems to have assumed that nuclear energy was economical, and was encouraged by the faddish enthusiasm of many officials who more on the basis of faith than rationality saw nuclear energy as the technology of the future. By the late 1960s, a lively environmentalist movement had emerged in the United States, and the Project Independence nuclear program was the subject of much debate in both the media and Congress. The ensuing debates revealed that many of the claims made for nuclear power vast underestimated the true costs of nuclear reactors. Equally problematic was the troublesome issue of where to safety store the spent nuclear rods that emitted a toxic level of radioactivity for centuries afterward in an cost-effective manner. The issue of the spent nuclear rods was especially difficult because in a classic case of NIMBYism, communities proved very unwilling to accept a storage place for the inevitable by-product of nuclear power, the spent nuclear rods, with the demand being made that the government find some other community to store the rods. Many of the nuclear reactors ordered in 1973 were cancelled due to the horrendous cost overruns while over 100 nuclear plants were shut down as uneconomical over the next 10 years. Unlike nations that tried to use nuclear power as a way for "energy independence" such as France and Sweden, the United States had substantial reserves of its own oil, which weakened the case for nuclear power in the ensuring debates. By 1989, only 18% of American energy came from nuclear power plants, which was a faction of what Project Independence had envisioned in 1973.

The "oil shock" led to anti-Arab feelings becoming common. Cartoons published in American newspapers during the "oil shock" depicted Arabs as disgusting, ugly, obese, corrupt and greedy. In the cartoons, the long hooked Semitic noses that had traditionally been featured in anti-Jewish cartoons were applied to the Arab sheiks as a way to illustrate their supposed greed. American public opinion did not see the use of the "oil weapon" as due to politics, and tended to explain the embargo as only due to the excessive greed of King Faisal and the other Arab leaders, hence the use of the hooked Semitic nose in the cartoons as a sort of shorthand for insatiable greed.