The dissertation addresses the causes and consequences of the 1973-1974 energy crisis. A new postcolonial concept of sovereignty, "permanent sovereignty over natural resources," challenged the structure of the international economy in the early 1950s. The proponents of permanent sovereignty identified the relationship between the industrial nations and raw material producers as a vestige of empire. By gaining control over national resources, Third World leaders hoped to reset the relationship between the developing and developed nations. The concept of permanent sovereignty authenticated new definitions and goals of decolonization and statehood. A new middle ground between U.S. diplomacy and Third World economic thought emerged in international oil politics. Chapters on the 1967 Arab oil embargo, Saudi and Iranian demands in the wake of imperial Britain's Persian Gulf withdrawal, the legal battles over the Iraqi Ba'ath regime's nationalized oil, and the reverberating effects of newly radical Libyan politics, explain how members of the Organization of Petroleum Exporting Countries (OPEC) remade permanent sovereignty between 1967 to 1972. OPEC underscored the salience of permanent sovereignty in the international political economy, but it also undermined it. The built-in tension culminated in the 1973-1974 energy crisis. The final chapters discuss how the impregnable sovereignty preached by OPEC and its transnational backers in the New International Economic Order engendered a strategic response from the United States: neoliberal diplomacy. OPEC's cartel politics became a scapegoat for policymakers who simplified and codified neoclassical economic ideas. Market-centered reform developed into an analytical refuge in the political-economic wreckage of the energy crisis. American strategy toward the International Monetary Fund and the United Nations reveal that neoliberal diplomacy became widely influential in U.S. foreign policy. / text