The 1973 oil crisis began in earnest on October 17, 1973, when the members of Organization of Arab Petroleum Exporting Countries announced, as a result of the ongoing Yom Kippur War, that they would no longer ship petroleum to nations that had supported Israel in its conflict with Syria and Egypt (i.e., to the United States and its allies in Western Europe).
At about the same time, OPEC members agreed to use their leverage over the world price-setting mechanism for oil in order to quadruple world oil prices, after attempts at negotiation failed. Due to the dependence of the industrialized world on OPEC oil, these price increases were dramatically inflationary to the economies of the targeted countries, while at the same time suppressive of economic activity.
This increase in the price of oil had a dramatic effect on oil exporting nations, for the countries of the Middle East who had long been dominated by the industrial powers were seen to have acquired control of a vital commodity. The traditional flow of capital reversed as the oil exporting nations accumulated vast wealth. Meanwhile, the shock produced chaos in the West, and shares on the New York Stock Exchange lost $97 billion in value in six weeks.