Epilogue Summary

The summer of 1990 was marked by euphoria over the end of the Cold War. Consumers were happy with low oil prices and prospects of abundant oil. Caution was in order, however, for several reasons: two-thirds of the world's reserves were in the Persian Gulf, demand was growing, American production was plummeting and imports rising, and the "security margin" - the gap between demand and production capacity - was shrinking. The conditions that triggered the 1973 oil shock had ominously returned, even as politicians and futurists discounted any possibility of another crisis.

On August 2, 1990, 100,000 Iraqi troops invaded Kuwait. Iraq was the only producer that had not rebuilt relations with Western customers, and Hussein had warned that the oil weapon could be applied again. Hussein was a brutal throwback to Stalin, and his aim was to dominate the Arab world. His nuclear weapons program was set...