From 1948 to 1970, oil prices ranged between $2.50 and $3.00 a barrel. That's around $17 to $19 a barrel if adjusted for inflation. The United States was the world's dominant oil producer. It regulated prices. Domestic oil was plentiful. Cheap oil and gas made the expansion of interstate highways, interstate trucking, and auto ownership part of the America Dream. Families moved in droves to the suburbs.

In 1960, Saudi Arabia and other foreign oil-exporting nations formed OPEC. They wanted more control over oil prices. In 1971, regulators allowed U.S. companies to pump as much oil as they wanted. They began using up surplus reserves. As supply fell, prices rose. America became vulnerable to future shortages.

OPEC did not really flex its pricing muscle until President Nixon effectively took the U.S. dollar off of the gold standard in 1971. The value of the dollar plummeted, taking oil revenues down with it. All oil contracts are traded in U.S. dollars, so oil prices follow the value of the dollar. 

In 1973, OPEC halted oil exports to the United States. Its primary goal was to boost oil prices. It also wanted to punish America for its support of Israel in the Yom Kippur War. To prevent future shortages, Congress created the Strategic Petroleum Reserve to provide a 90-day supply.

Since 1974, oil prices have been volatile.

 They are affected by more than the laws of supply and demand. Oil prices are determined by oil futures contracts on the commodities markets.  That means commodities traders control oil prices. They will drive prices up even if they only think there will be a surge in demand, such as during the summer driving season, or a shortage, such as during the Libyan uprising.

 

In 2011, oil prices began to develop a predictable seasonal swing. Prices rise in the spring as oil futures traders anticipate high demand for summer vacation driving. Once demand has peaked, prices normally drop in the fall and winter. 

Oil Prices by Year: Average, High, Low, and Events

The following chart shows the prices for imported oil from Energy Information Administration. The first column shows the average annual price. It's followed by the high and low oil prices that year and the month they occurred. It points out reasons for the price variations and the accompanying events. 

Year	Average	Low	High	Causes
1973	$4.08	n.a.	n.a.
1974	$12.52	$9.59  Jan	$13.06  Jun	OPEC oil embargo ended.
1975	$13.95	$12.77  Jan	$15.04  Nov	Stagflation.
1976	$13.48	$13.27  Jan	$13.71  Dec	Economy recovered.
1977	$14.53	$14.11  Jan	$14.76  Dec	Fed raised and lowered rates.
1978	$14.57	$14.41  Feb	$14.94  Dec
1979	$21.57	$15.50  Jan	$28.91  Dec	Iran-Iraq War. Fed rate 20%.
1980	$33.86	$30.75  Jan	$35.63  Dec	Iran oil embargo.
1981	$37.10	$35.43  Oct	$39.00  Feb	Reagan cut taxes.
1982	$33.57	$32.78  May	$35.54  Jan	Recession ends inflation.
1983	$29.31	$27.95  Apr	$31.40  Jan
1984	$28.88	$28.02  Dec	$29.26 May
1985	$26.99	$26.21  Dec	$27.60  May
1986	$13.93	$10.91  Jul	$24.93  Jan	OPEC adds to supply.
1987	$18.14	$16.45  Jan	$19.32  Aug
1988	$14.60	$12.66  Nov	$15.93  May
1989	$18.07	$16.04  Jan	$20.05  Dec
1990	$23.73	$15.15  Jun	$32.88  Oct	Gulf War.
1991	$18.73	$17.17  Dec	$22.30  Jan	SPR released oil.
1992	$18.21	$16.00  Feb	$19.83  Jun
1993	$16.13	$12.56  Dec	$18.35  Apr
1994	$15.54	$12.90  Feb	$17.52  Jul	NAFTA allowed cheap oil.
1995	$17.14	$16.29  Oct	$18.56  May
1996	$20.62	$17.48  Jan	$23.22  Oct
1997	$18.49	$15.95  Dec	$23.02  Jan
1998	$12.07	$9.39  Dec	$14.33  Jan
1999	$17.27	$10.16  Jan	$24.35  Dec	Prices doubled.
2000	$27.72	$24.29  Apr	$30.56  Sep
2001	$21.99	$15.95  Dec	$24.63  May	Recession.  9/11 attack.
2002	$23.71	$17.04  Jan	$27.14  Sep	Afghanistan War.
2003	$27.73	$24.48  Apr	$32.23  Feb
2004	$35.89	$30.11  Jan	$45.36  Oct
2005	$48.89	$37.56  Jan	$58.79  Sep	Hurricane Katrina.
2006	$59.05	$52.70  Oct	$67.99  Jul	Bernanke becomes Fed chair.
2007	$67.19	$49.57  Jan	$85.53  Nov
2008	$92.57	$35.59  Dec	$127.77  Jul
2009	$59.04	$36.84  Jan	$74.40  Nov	Great Recession
2010	$75.83	$73.73  Feb	$85.59  Dec
2011	$102.58	$87.61  Jan	$107.98 May
2012	$101.09	$92.18  Jun	$108.54  Apr	Iran threatened Straits of Hormuz.
2013	$98.12	$90.36  Nov	$104.16  Aug
2014	$89.63	$57.36  Dec	$100.26 Jun	Dollar rose 15%. U.S. shale oil increased.
2015	$46.34	$33.16  Dec	$58.89 Jun
2016	$38.17	$26.66  Feb	$46.72 Dec	Dollar fell and OPEC cut oil supply.
2017	$48.73	$43.93  Jun	$54.38 Dec

 

In Depth: Oil Price Forecast | Sunni/Shiite Conflict | Shale Oil Boom and Bust | U.S. Nuclear Power

More History

• History of U.S. Recessions
• Fed Funds Rate History
• National Debt by Year
• GDP Growth Rates by Year
• Unemployment Rate by Year
• Inflation by Year
• Gold Prices by Year