This article examines the historical emergence of the Middle East oil-pricing system. The collapse of the Gulf-plus system, combined with outstanding discoveries of new reservoirs across the Arabian Peninsula and Persia, awoke latent competitive forces within the oligopolistic oil industry. After World War II, business differences regarding vertical integration, market priorities, and global competition worsened existing fractures among the multinational oil companies generally referred to as “the seven sisters.” The conclusions underscore the role of the “fringe” companies Texaco, Standard of California–Chevron, and Gulf Oil in prompting new price equilibriums for Persian Gulf crude oil.
