Gulf Bottleneck: Middle East Stability and World Oil Supply‪.‬

Richard N. Cooper is Boas Professor of International Economics at Harvard University. Since the disturbances caused by the Iraqi invasion of Kuwait six years ago, the international flow of oil has gone uninterrupted and unimpeded, but that tense summer of 1990 rekindled memories of the volatile oil prices of previous decades. In 1973, 1979, 1980, and 1990, major disruptions in the flow of Middle Eastern oil caused world oil prices to surge, and in 1986, the practical collapse of the Organization of Petroleum Exporting Countries (OPEC) led to a 50 percent drop in prices. The Middle East remains the key to the stability of global energy markets. With the world's dependence on the region poised to increase dramatically, what are the prospects for continued calm in Middle Eastern oil markets?