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Introduction
Published online by Cambridge University Press: 24 October 2022
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The “energy crisis” has often been advanced as the most important explanation of many Latin American nations' economic and political behavior during the 1960s and 1970s. Low oil prices led Venezuela to join in founding OPEC in 1960 and to take an active role in reaching its decisions. The fear of an oil embargo in 1973–74 forced Brazil to shift to a pro-Arab foreign policy. The increased oil prices of the past decade permitted, but did not ensure, rapid growth of Latin American oil producers, and are associated with massive increases in foreign borrowing and the search for new energy sources by both oil consuming and producing nations. The expenditure of increasing shares of national income on energy production and distribution influences life styles by leaving fewer resources for other activities, and will continue to do so at least until substitutes for current energy sources become available at attractive prices.
- Type
- Symposium: Energy Policy in Latin America
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- Copyright
- Copyright © 1982 by the University of Texas Press
Footnotes
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I wish to thank Daniel Gross and Susan Lees for extensive comments.
References
Notes
1. Studies of national energy policy for individual Latin American nations are not included here, since several have recently been published. See, for example, Kenneth Paul Erickson, “Brazil,” and Laura Regina Rosenbaum Randall, “Mexico,” in Kenneth R. Stunkel, ed., National Energy Profiles (New York: Praeger, 1981); Jerry R. Ladman, Deborah J. Baldwin, Elihu Bergman, eds., U.S.-Mexican Energy Relationships (Lexington, Mass.: D.C. Heath and Co., 1981); Luis Claudio de Almeida, “El modelo energético de Brasil,” Bruno Philippi, “Síntesis de la situación energética de Chile,” and Raúl Espinosa, “El rol de la empresa privada en el desarrollo energético de Chile,” in Heraldo Muñoz, Desarrollo energético en América Latina y la economía mundial (Santiago de Chile: Editorial Universitaria, 1980).
2. See Laura Randall, “Determinants of Oil Production in Latin America, 1960–1975,” forthcoming. Preliminary results indicate a significant (.01) relationship between crude oil output, changes in profit by sector, and international reserve levels, which explains well over 90 percent of output when appropriate international prices are used to construct oil profit estimates.
3. A recent example is Brazil's sale of fuel alcohol for gasohol to a United States firm. The sale was needed because of delays in the production of Brazilian vehicles which burn gasohol. This left Brazil with a surplus of fuel alcohol. According to Stuart Mieher, the result was American protests that the imports put the United States “in the awkward position of substituting our national dependence on petroleum for a dependence on foreign fuel alcohol.” The United States Department of Energy issued a preliminary order barring the United States firm from mixing a new allocation of gasoline with Brazilian alcohol (Wall Street Journal, 18 June, 1980, page 15).
Another observer, however, attributes the U.S.D.O.E. move to the allegation that the Brazilian export price of fuel alcohol was below the price at which that product sells in Brazil, so that imports of the product to the United States would constitute “unfair competition.” In this case, fuel imports depend upon trade rather than energy policy.
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