Brazil's approach to the 1973 oil shock: politics, diplomacy and economics

Abstract

The 1973 oil shock had serious repercussions throughout the world, wreaking great havoc on international political and economic relations. Nevertheless, the countries most dependent on oil imports had to pay the most severe consequences, and Brazil is among them. The objective of this thesis is to analyse the policies and actions implemented by the Brazilian government in conjunction with the objectives set to manage this crisis. The first chapter will provide an overview of the democratic period in Brazil, analysing the economic policy of the military presidents from 1946 to 1973 to highlight the issues that the Geisel government inherited through the implementation of the II PND. The following chapter will focus on the Geisel government, the protagonist in the management of the first oil crisis. This section will discuss the policy adopted by the government to deal with the crisis in accordance with its objectives, while also attempting to analyse the multilateral perspective of Brazil's relations with regional scenarios. Emphasis will also be placed on onshore oil extraction and what factors led Petrobras and the Brazilian government to invest in research in offshore sedimentary basins and risk contracts, in order to minimize spending on oil, creating alternative energy projects and subsidiaries. The last chapter will provide, through the research of a series of Brazilian documents, an experimental analysis of Brazil's policy to tackle the 1973 oil shock, which will enable to actually state whether the policies implemented to react to the crisis were effective. The desired outcome of this case study is to underline how these oil crises had an impact in the case study of Brazil shaping International Relations