“WHAT”, sneered Abdurrahman Salim Atiqi, Kuwait’s one-time oil minister, “is the point of producing more oil and selling it for an unguaranteed paper currency?” In 1973, when most people feared that nothing could stop greedy OPEC members from raising oil prices as much as they chose—though not this newspaper, which forecast an oil glut—the producers affected to accept western cash for their black bullion out of charity. Now the long oil-price odyssey seems at an end. Since its peak in 1980, the price has fallen erratically. It has plunged by half in the past two years alone. In real terms, oil now costs roughly what it did before 1973. Crude is gushing from the ground at the rate of 66m barrels a day, half as copiously again as in OPEC’s prime. The world is awash with the stuff, and it is likely to remain so.

That is good news, is it not? For consumers, certainly, especially those in poor countries whose lives will be improved by the warmth, light and mobility that cheaper energy brings. It would be progress, too, to get away from the notion that oil is scarce—an assumption that led to two decades of energy-policy mistakes, such as subsidising coal and nuclear power.

But do not imagine that the bad dream is over. It is worse than ever for some of the world’s most populous and poorest countries that make their living from oil. Petroleum provides over half the government’s income in such places as Iran and Nigeria. OPEC‘s oil revenues last year were, in real terms, only a fifth of their peak in 1980, so most oil producers are beset by huge budget and current-account deficits. If cash-strapped producers cut expenditure faster than consumers spend their windfall, the effect of lower oil prices might even be to slow world economic growth.

Cheap oil could cause instability as well as poverty. As a result of last year’s low prices, the Mexican government has revised its budget three times and increased borrowing. Mexico is hardly a paragon of good government, but, thanks to the diversification of its economy since the 1980s, it at least has an alternative to oil. Many other oil-producing countries are ill-placed to cope with low prices. Cheap oil might merely aggravate the twin evils of corruption and bad government.

The bigger fear is that consumers will one day suffer, too. Hydrocarbons and political volatility seem to go together. The Middle East has the world’s cheapest and most abundant reserves of high-quality oil. Russia supplies most of Western Europe’s natural gas. The dependence that this implies has been obscured in the past decade because OPEC’s high prices in the 1970s and 1980s paid for the development of oil and gas fields in such expensive regions as the North Sea.

But low prices will gradually put most such areas out of business—especially if cash-strapped Gulf states conclude that the best way to increase revenues is to boost production, which could drive prices from today’s $10 to as little as $5 (see article). The world will then again depend on a few Middle Eastern countries for half its oil, up from a quarter now.

At least for the moment, three of these countries—Kuwait, Saudi Arabia and the United Arab Emirates—are staunch western allies. But Iran and Iraq are not; and the whole of the Gulf is unstable. All the region’s governments are suffering from the decline in the oil price. Most are repressive and unpopular. None has a sure hold on power.

If the Saudi royal family, in particular, were overthrown, it would send oil markets into turmoil. Once low prices move more production back to the Middle East, even a toppled emirate or two might be enough to cause disarray. It is no use hoping that a rebel government would keep the oil flowing at any cost. Remember the revolution that overthrew the shah of Iran in 1979. It cut supplies for only a few months—but was enough to trigger the second oil shock.

Of course, any such shock would be different today. Economies depend less on oil than they did. The development of markets to trade oil and oil futures means that price signals are relayed faster and more efficiently. Oil-producing capacity outside OPEC could be brought back on stream should oil prices ever blip up again. Yet any interruption to oil supplies would be hugely damaging to the world economy. That is why, even as prices fall, governments of consuming countries should be guarding against the dangers of oil dependence.

One way of doing this is to keep researching into alternatives to the petrol-powered internal combustion engine, such as fuel-cell systems, which can derive hydrogen from natural gas. Another is to curb consumption through higher petrol taxes. The country best able to make a difference is America, which consumes a quarter of the world’s oil, almost all of it for transport. American petrol taxes are so low that they do not even take account of environmental costs such as pollution. There is no better time to perform the politically awkward feat of raising taxes than when oil prices are low and the money can be quickly handed back in lower taxes elsewhere.

Yet even this would serve only to mitigate the future risks. By all means, welcome the return of normality to oil markets and the end of OPEC‘s power. But just as oil’s scarcity seemed a fact of life in the 1970s, its abundant flow might be too easily taken for granted today. Normality could last a while; but it is unwise to assume that it will endure for ever.