Anglo-Persian Oil Company
The British oil company, ancestor of BP, whose lopsided grip on Iran's oil made it a symbol of Western exploitation and sparked the 1953 coup.
On May 26, 1908, after seven years of drilling in the Persian desert and more than 500,000 pounds spent, a British crew at Masjed Soleyman finally hit oil. The gusher rose fifty feet above the rig. It was the first commercial oil strike in the Middle East, and it arrived just as the venture's backers had drafted the telegram ordering the crew to pack up and go home. Within a year the find had a corporate owner: the Anglo-Persian Oil Company, chartered on April 14, 1909.
Oil for the fleet
The company grew up entangled with British naval power. In 1913 it opened a refinery at Abadan on the Persian Gulf, for half a century the largest in the world. The following year, with the Royal Navy converting from coal to oil and war looming in Europe, First Lord of the Admiralty Winston Churchill pushed the British government to buy a 51 percent stake for 2.2 million pounds. London now owned a controlling share of a company pumping another nation's oil. The motive was strategic, not commercial: guaranteed fuel for the fleet at a fixed price.
An unequal bargain
The terms were the scandal. The original 1901 D'Arcy concession handed a British subject exclusive rights to explore across most of Persia for sixty years, and promised Persia just 16 percent of net profits, a figure the company's accountants could shrink at will. In some years the British Treasury collected more in tax from Anglo-Persian than Iran received in royalties. Iranian workers at Abadan lived in squalor while dividends flowed to London. Renamed the Anglo-Iranian Oil Company in 1935, the firm became the most visible symbol of Western exploitation in the country.
Resentment finally boiled over. In 1951 Prime Minister Mohammad Mosaddegh nationalized the company, folding its assets into the new National Iranian Oil Company. Britain answered with a global boycott, a naval blockade of Abadan, and a case at the World Court. When economic pressure failed to break Mosaddegh, the CIA and MI6 engineered the 1953 coup that removed him and restored the Shah.
From APOC to BP
The aftermath was quieter but decisive. A 1954 settlement created an international consortium to run Iran's oil, and the old company, renamed the British Petroleum Company that same year, kept a 40 percent share alongside American and other European majors. Nationalization on paper had become foreign control in practice, a bargain that fed Iranian grievances for a generation.
The company that struck oil at Masjed Soleyman would eventually drop every trace of Persia from its name and become simply BP. But the arrangement it embodied, a Western firm and its government profiting handsomely while the country under their feet got scraps, outlived the name. The 1953 coup it triggered is still cited in Tehran as the original sin of Anglo-American meddling, proof that the fifty-foot gusher of 1908 was never only about oil.