Page 402 - Arabia the Gulf and the West

The ‘Sting’ 399

The sequence of reprisals began with an announcement by Abu Dhabi on 19
October that she was imposing a complete ban on oil shipments to the United
Slates. For connoisseurs of international drollery the gesture had an especial
charm; for at that very moment Abu Dhabi was anxiously trying to raise a large

loan in US dollars through the agency of a London merchant bank. On the
same day Colonel Qaddafi proclaimed a similar embargo, addingen passant that
the price of Libyan oil was being raised from $4.90 to $8.92 a barrel, effective
immediately. The other Arab oil states waited to see what Saudi Arabia would
do. On 18 October President Nixon had asked Congress to approve the

expenditure of $2,000 million to cover shipments of arms to Israel. King Faisal
took the request, coming as it did so soon after his warning of a few days earlier,
as a personal insult. On 20 October he let the world know the measure of his
wrath. Declaring a jihad against Israel and calling upon Muslims everywhere to
join it, he ordered the cessation forthwith of all oil shipments to the United
States, including supplies to the American armed forces wherever they might
be. The next day Yamani summoned the heads of ARAMCO to Riyad and

gave them detailed instructions about the implementation of the embargo. Not
only were there to be no direct shipments of oil to the United States, but
indirect shipments through American refineries in Canada, the Caribbean and
elsewhere were also banned. In addition to the cut in production resulting from
the embargo upon the supply of oil to the United States, there was to be a
general cut of 10 per cent, based upon the output for September. The total

reduction would amount to roughly 1.8 million b/d, i.e. from almost 8.3
million b/d in September to 6.5 million b/d in October.
A series of further instructions from the Saudi oil minister followed.
Countries which subscribed, or were deemed sympathetic, to the Arab cause
were to be spared the adverse effects of reduced production. They were to
receive supplies equivalent to their average daily consumption over the pre­
vious nine months. In this category were included Britain, France, Spain,

Jordan, Lebanon, Malaysia, Pakistan, Tunisia and (somewhat superfluously)
Egypt. Other countries, not specifically placed on the embargo list, would
share the remaining crude oil available on a pro rata basis, according to their
previous respective volumes of consumption. When the ARAMCO represen­
tatives pointed out that this ruling would bear harshly upon countries like
Japan and Italy, Yamani responded by saying that this was the intention. (At

the OAPEC meeting in Kuwait on 17 October one of the delegates had
referred to Japan’s position in the Arab-Israeli conflict as one of ‘odious
neutrality’.)
The lesser oil states hastened to join the dance. Within a couple of days
uwait, Bahrain, Qatar, Dubai and Algeria had all banned the shipment of oil
to the United States and cut their production by 10 per cent. Iraq, while ready

to orbid the sale of oil to the United States, refused to cut production, not
ecause she was any less impatient for the fray (Iraqi troops, after all, had been