ILTS Social Science History (246) Complete Practice Exam 2025

The economic downturn resulting from a steep increase in oil prices during the 1970s serves as a clear demonstration of the domestic impact of U.S. foreign policy in the Middle East. This period coincided with the 1973 oil crisis when the Organization of Arab Petroleum Exporting Countries (OAPEC) proclaimed an oil embargo in response to U.S. support for Israel during the Yom Kippur War. As a result, oil prices skyrocketed, leading to inflation, increased costs of goods, and economic stagnation in the United States, commonly referred to as "stagflation."

This development highlighted how foreign policy decisions regarding international relations and conflicts could trigger significant economic repercussions at home, illustrating the interconnectedness of global dynamics and domestic affairs. The situation prompted the U.S. to reassess its energy policies and foreign policy strategies toward the Middle Eastern countries, showcasing the direct influence that foreign policy can have on the domestic economy and everyday life for American citizens.