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  Home>> History>> Prosperity and Decline: 1947-1980>> 1970s Economic Growth

1970s Economic Growth

Peter LougheedIn 1973, Alberta's economy received a dramatic boost when the Organization of Petroleum Exporting Countries (OPEC) restricted oil exports to Canada, the United States and other supporters of Israel during that country's war against Syria and Egypt. Suddenly, the price for crude oil quadrupled. Demand for Alberta's oil skyrocketed.

The Progressive Conservative government under Peter Lougheed had just come to office in 1971, replacing the Social Credit government that had been in power since 1935. As hundreds of thousands of workers immigrated to Alberta seeking to share in the province's wealth, Lougheed's government was forced to deal with the needs of Alberta's rapidly expanding population. Using money from increasing oil and gas royalties, they expanded services to smaller urban centres, including airports, roads and hospitals. In the major cities, they contributed money to establish parks and other facilities. In 1976, they set up the Alberta Heritage Savings Trust Fund to invest surplus money for the province's future.

Pumpjack

While Alberta was booming after the OPEC embargo, the rest of the country had to pay for increasing fuel costs. The federal Liberal government under Pierre Trudeau attempted to reduce fuel costs by freezing oil prices and taxing oil exports. Lougheed responded by further raising royalty charges. These actions encouraged many American oil corporations to leave the province. The Alberta government subsequently became more involved in developing the province's energy resources. Late in 1973, it set up the Alberta Energy Company, which became the province's second largest oil developer. The government also helped Syncrude develop the Athabasca oil sands surrounding Fort McMurray.

Alberta's economy was highly dictated by oil in the last half of the 20th century. While high oil revenues meant a prosperous economy in the 1970s, declining oil prices led to a recession in the 1980s.

In this episode of CKUA's Heritage Trails radio series, you can tune in as host Cheryl Croucher and historian David Leonard recount the positive effects that the 1975 OPEC oil embargo had on the Alberta Economy.  [Listen]

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