Abel Amene

In Defence of Decolonial Nationalism as the First Stage of Iran’s Struggle Against Imperialism

Mohammad Mossadegh, Prime Minister of Iran for a brief period from 1951 to 1953, often did not rise from his bed, but he became one of the most influential people in the history of modern Iran. His daring move to nationalize the oil industry was the most important event of the mid-20th century. When considering the history of the nation from World War II until the Iran–Iraq War, the 1953 coup d'état which ousted Mossadegh is a tempting candidate for the most notable event. One might also be tempted to name the Islamic Revolution as a key event in the history of Iran in that period. Despite their impact, both the 1953 coup and 1979 revolution pale in comparison to and are themselves precipitated by a single heroic action undertaken by Mossadegh. This was the act of nationalizing the oil industry and asserting Iran’s sovereignty, a project which he doggedly pursued despite fierce opposition. Because Iran’s current control of its natural resources factors into almost all aspects of its global political position, and because of how oil nationalization successfully and lastingly asserted Iran’s sovereignty on the world stage, the nationalist movement led by Mossadegh was the most significant development of the mid-20th century and continues to dictate the history, current conditions and future of Iran.

Kwame Nkrumah, who became Prime Minister of Ghana around the same time Mossadegh came to power, was a pan-Africanist and socialist revolutionary who, like Mossadegh, freed his nation from British colonial rule. Nkrumah wrote that decolonial nationalism among an indigenous people is the ideological medium through which the colonized can win the struggle against imperialism and assert their independence (Nkrumah 24–25). He argues that a nationalist phase, as a stepping stone towards an internationalist and socialist future, is an essential first step towards the liberation of a colonized people (Nkrumah 25). However, was Iran a colonized nation? Well, colonization takes many forms, including neocolonialism, which is the indirect control of less-developed countries through economic, diplomatic, and other political means. The British control over Iran’s oil industry and resources certainly fits the bill.

In 1901, Muzzaffar al-Din Shah sold the exclusive right to exploit Persia’s natural gas and petroleum resources to William Knox D'Arcy, a British-Australian mining tycoon. It took D’Arcy’s explorers a decade to finally take advantage of this concession and strike oil (Kinzer 33). Soon after, the Anglo-Persian Oil Company, which later became the Anglo-Iranian Oil Company, acquired the rights from D’Arcy. In 1914, through a measure introduced in the House of Commons by Winston Churchill, who decades later became the British prime minister, the United Kingdom acquired a majority stake in the Anglo-Persian Oil Company (Mina). The British had seized a “fantastically lucrative monopoly” on the Persian oil industry for a relatively cheap price (Kinzer 4). Without a single shot fired or any invasion, the European power had gained another foothold to expand its empire in West Asia. Persia had become another British colony in everything but name. As Churchill put it, Persian oil was “a prize from fairyland beyond our wildest dreams” (Kinzer 39). 

While the quasi-colony’s exploited natural resources were crucial in maintaining Britain’s imperial hold on the world and made the empire better poised to face the impending First World War, most Persians lived in relative poverty (Kinzer 2). Persia was supposed to receive royalty payments to compensate the country for the resources the British were extracting, but, in reality, the Anglo-Persian Oil Company found a variety of creative ways to mostly evade making payments. These included giving large dividend payments to shareholders, including the British government itself, paying “excess profit tax” to the British government, and granting undisclosed discounts to the British military. Besides allowing the British to triple dip into Iran’s oil industry in this way, the company also manufactured false accounting documents to hide its profits. By 1931, royalty payments to Iran had been reduced to a measly £307,000 for the 5.7 million tons of crude oil extracted per year. 

In November 1932, Reza Shah Pahlavi announced the cancellation of the concession, but this only made matters worse. The British naval might was brought to the Persian Gulf, and cases were filed before the international courts at The Hague (Bina 69). The Shah was quickly forced to sign a new concession that disadvantaged his nation even more than the one he had attempted to cancel. This included extending the concession for an additional 30 years to last until 1993— allowing the British to continue to enjoy huge exploitative rights to Iran's oil resources while giving increasing dividends to its shareholders, including the British government. Compared to the previous 5% before the signing of the new concession, shareholder dividends rose to 20% in 1936–38 and then to 30% in 1946–51 (Bina 70).

British colonial control over Iran’s resources was widely unpopular among Iranians. The Tudeh Party, a communist party that rose in prominence in the early 1940s and enjoyed mass support among the working class, was the first to call for nationalization of the oil industry as early as 1946 (Abrahamian 107–113). While the influence of the Tudeh Party waned due to its alignment with the Soviet Union, what emerged in the next few years was a popular indigenous nationalist movement led by Mossadegh. He formed the National Front from a broad alliance of parties and organizations, including both conservative and liberal elements of Iranian society (Abrahamian 113–115).

With popular support, Mossadegh was elected prime minister in 1951 and quickly moved to nationalize the oil industry. Unlike the first Pahlavi shah, who had in 1941 abdicated his throne to his son, Mohammad Reza Pahlavi, Mossadegh was daring and persistent in routing the British from their continued exploitation of Iran. He formed the National Iranian Oil Company (NIOC) and, when the British resisted the takeover, ordered the NIOC to forcibly assume control over the operations of the Anglo-Iranian Oil Company (Abrahamian 116–117). In pushing for nationalization, Iran was motivated by the desire for democracy and independence (Bina 71). Mossadegh himself argued while serving as Iran’s agent before the International Court of Justice (ICJ) that, “The Iranian nation[,] which had grown tired of this situation[,] put an end to foreign domination in one go, in a manly movement, by nationalizing the oil industry” (Mossadegh 141).

The British response was almost the same but even more pronounced than their reaction to Reza Shah’s cancellation of the concession. Just as before, the British navy was directed to the Persian Gulf, a legal case was brought before the ICJ, and a grievance filed at the UN Security Council. The British went further by instituting an embargo to stop the flow of all Iranian oil, which they labeled as “stolen property” (Mina; Bina 71). To ensure an effective embargo, the British navy stopped even ships sailing under the flags of other nations, seizing their cargo and ensuring that no Iranian oil could be exported (Heiss 194–196). The British government also seized funds Iran had in British banks (Mossadegh 141).

Despite these extraordinary efforts, the British were unable to bring their colonial subject to heel (Bina 71). Unlike Reza Shah, Mossadegh rejected every proposal put forward by the British to reassert their control (Bina 72). After he broke off yet another round of negotiations, the British finally convinced their US allies to orchestrate a coup d'état in 1953 (Gasiorowski 232). With Mossadegh overthrown by the CIA, the West was able to force a new concession and, once again, de-nationalize the oil industry under the control of a consortium of British, American and French companies who jockeyed to divvy up Iran’s rich oil resources (Bina 72). 

However, Mossadegh’s work was not so easily undone; even with the return of western imperial influence, gone was Britain’s “fantastically lucrative monopoly” and the grotesque license they seemed to enjoy that permitted them to lie and cheat while they pilfered Iran’s resources. The NIOC also remained in place and retained ownership of Iran’s oil assets. Two operating companies respectively responsible for exploration and refinement were incorporated in Iran, and Iranians became involved in all levels of management all the way up to directors (Mina). Profits were shared between the Iranian government and the foreign consortium 50/50 (Bina 72). The term of the concession was reduced to 25 years, with three 5-year extensions for a maximum of a 40-year term (Mina). Even before the 1979 revolution, the result of Mossadegh’s nationalist movement was a significant improvement, with the country getting a bigger share of the profits from its natural resources.

In 1973, the NIOC ultimately accomplished Mossadegh’s goal of taking complete control and management of the oil industry into the hands of the Iranian government (Mina). Faced with an ultimatum which threatened to simply end the agreement at the end of the initial term, the foreign consortium agreed to give up their hold on the industry in exchange for a privileged status as a preferred buyer. The following year, the Petroleum Act was enacted to include a provision declaring that, “The Petroleum resources and the Petroleum industry of Iran belong to the Nation” (Mina).

Despite the backslide following the 1953 coup, Mossadegh’s nationalization of the oil industry permanently changed Iran’s position on the global scale. When considering his legacy, it is tempting to place all emphasis on the 1953 coup, but that fails to grasp the seismic shift represented by Iran gaining full control of its natural resources and the long-lasting effects of his assertion of Iran's sovereignty — perhaps for the first time in its recent history. 

Before the advent of Mossadegh’s nationalist movement, did Iran, or Persia for that matter, have a concerted and united national identity? Was Persia under Qajar rule or Iran under the Pahlavi dynasty truly an independent nation? Mossadegh’s legacy is not what the coup to oust him wrought but what his successful nationalization did for Iran’s political and economic power on the world stage. Near the end of his speech before the ICJ, Mossadegh put it simply, “The decision to nationalize the oil industry is the result of the political will of an independent and free nation” (Mossadegh 141). In kickstarting a decolonial nationalist movement in Iran, Mossadegh succeeded in overthrowing a half century of British colonial indirect rule and established Iran as a formidable power in West Asia. While those that came after him undid some of the gains he made in freeing his nation from foreign influence, Mossadegh ensured that no outside actor will ever again underestimate the power and will of the Iranian people.