The 1970s and early 1980s saw the onset of stagflation. The United States supported Israel during the Yom Kippur War; in response, the country faced an oil embargo from OPEC nations, sparking the 1973 oil crisis. In 1979, President Jimmy Carter brokered a peace treaty between Egypt and Israel, marking the first time an Arab nation recognized Israeli existence. After his election, President Ronald Reagan responded to economic stagnation with free-market oriented reforms. Following the collapse of détente, he abandoned “containment” and initiated the more aggressive “rollback” strategy towards the Soviet Union. The late 1980s brought a “thaw” in relations with the Soviet Union, and its collapse in 1991 finally ended the Cold War. This brought about unipolarity with the U.S. unchallenged as the world’s dominant superpower.
After the Cold War, the conflict in the Middle East triggered a crisis in 1990, when Iraqinvaded and annexed Kuwait, an ally of the United States. Fearing the spread of instability, in August, President George H. W. Bush launched and led the Gulf War against Iraq; waged until January 1991 by coalition forces from 34 nations, it ended in the expulsion of Iraqi forces from Kuwait and restoration of the monarchy.