Files released to the British National Archives on Thursday show that British spy chiefs believed the US would be prepared to invade the countries to seize their oilfields.
The papers, made public under the 30-year rule for classified documents, reveal UK intelligence agencies estimated the US would take military action to prevent further disruption to oil supplies.
The assessment followed the decision in October 1973 by Arab nations to slash oil production and send prices rocketing, while imposing a complete embargo on the US over their support for Israel.
In Britain, Prime Minister Edward Heath's Conservative government was forced to draw up plans for gasoline rationing after panic buying led to shortages at filling stations.
Although the war in the Middle East was over after three weeks, a secret assessment drawn up for government ministers concluded the US would rather risk military action than be held to ransom by Arab oil-producers.
The report, dated 12 December 1973 and marked UK Eyes Alpha, calculated the US could guarantee sufficient oil supplies for themselves and their allies by invading countries with total reserves of more than 28 billion tonnes.
Abu Dhabi holds significant oil
It warned the American occupation would need to last 10 years as the West developed alternative energy sources, and would result in the "total alienation" of the Arabs and much of the rest of the Third World.
The United States would even consider pre-emptive action if Arab governments, "elated by the success of the oil weapon", began imposing new demands.
"Even if this had not happened, the US government might consider that it could not tolerate a situation in which the US and its allies were in effect at the mercy of a small group of unreasonable countries," the report said.
"In view of the incalculable consequences of military action against the Arabs, we consider that US intervention would probably come late as a move of last resort.
"But we cannot rule out the possibility of a rather earlier intervention."
The Joint Intelligence Committee (JIC) said the initial US invasion force would not have to be large, with two brigades to seize the Saudi oilfields and one brigade each to take Kuwait and Abu Dhabi.
In order to maintain the element of surprise, the US' first choice would probably be an airborne assault, but if that proved impracticable they could send an amphibious task force.
"For Saudi Arabia, the operation could be fairly straightforward. The peacetime garrison of Dhahran is one lightly armed National Guard battalion and a Hawk SAM battery," the report said.
"The initial assault could be made by a brigade tasked to knock out the Hawk battery, seize the airfield, and so far as possible prevent sabotage to the oilfields.
"In view of the incalculable consequences of military action against the Arabs, we consider that US intervention would probably come late as a move of last resort...But we cannot rule out the possibility of a rather earlier intervention"
1973 UK intelligence report
"For Kuwait the operational problems are greater. The Kuwaitis have about 100 tanks, mostly concentrated near the airport.
"This means that although the initial assault could still be made by a brigade, the assault force would need to be rapidly reinforced, say within six hours, by tanks of its own."
The US would almost certainly ask to use the British staging facilities at Gan or Diego Garcia, in the Indian Ocean, the report said.
The JIC said the US would probably give the Soviet Union prior notice of its intentions, and that Kremlin opposition would "probably stop short of direct military intervention".
However, in a reversal of what was actually to happen 18 years later, the JIC said that if the US seized Kuwait, Iraq might try to mount a counter-invasion to expel them.
"The greatest risk in the Gulf would probably arise in Kuwait, where the Iraqis, with Soviet backing, might be tempted to intervene."