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THE U.S. superficially would seem well able to withstand a sellers' boycott. The nation now imports about a third of the 17 million bbl. of oil it burns each day, but no more than 11% comes from the Arab countries. Cutbacks could prompt other major suppliers to reduce sales to the U.S. in order to conserve supplies in a tight global market. Even so, an eventual 25% slice in Arab output would cut U.S. supply about 2,000,000 bbl. a day.
Unfortunately, those barrels are critical. The U.S. is running short of oil and needs every drop it can get. Airlines are discussing scheduling fewer flights. Democratic Senator Henry Jackson of Washington has introduced a bill that would, among other things, lower the speed limits on interstate highways to 50 m.p.h. or less and force some utilities to convert from oil to higher-polluting coal. The most chilling aspect of an oil embargo—literally—is that the U.S. might be unable to stay warm this winter. The Interior Department figures that the nation will have to import 650,000 bbl. of heating oil a day to supply adequate heat, but Economist Lawrence Goldstein of the Petroleum Industry Research Foundation fears that other countries will sell only 350,000 bbl. a day. White House Aide Melvin Laird offers this advice: "I'd buy a sweater."
WESTERN EUROPE imports 72% of its oil from the Arab countries, and it has even fewer alternative sources than the U.S. Price increases could add $1 billion to Britain's trade deficit next year. Supply shortages will take longer to show up—about a month's supply of Arab oil is headed for European ports in tankers already at sea—but eventually shortages are a real threat. Giovanni Theodoli, president of Chevron Oil Italiana, fears a 20% drop in Italian crude-oil imports over the next six months, and worries that "we are not going to have enough energy to support our industry." The British government already has printed ration books and stacked them in post offices.
JAPAN has to import almost all of its oil, 82% from the Mideast. Surprisingly, the Japanese are fairly calm, largely because they believe that they can negotiate special deals with the Arabs. Perhaps they can, but the deals would be swung at the expense of U.S. and European supplies, and of higher prices for the Japanese consumer.
All this assumes that the Arabs actually carry out their threats. Before last week's moves, U.S. Energy Expert Robert Hunter expressed skepticism that an Arab oil cutback would work, even as part of a war against Israel, because "every oil producer would be watching every other one to see which was trying to carve out a larger place in long-term markets by violating a proclaimed embargo."
In the Arab nations the West is facing something new: a group of countries that do not need the money that they could get by expanding output. By 1980 the Arab countries will be getting at least $50 billion a year for their oil. The Arabs believe, with some justice, that the price of oil can go only one way—up. Oil kept in the ground is thus a kind of savings account. It will be worth more in, say, 1976 than it is today.