Iranians celebrating oil industry nationalization on March 19

EghtesadOnline: March 19th coincides with 29th of Esfand in the Iranian calendar which is the anniversary of the nationalization of oil industry in Iran.

News ID: ۷۷۴۷۰۴

19 March 2017

The oil industry was nationalized on a day like today 67 years ago during the premiership of late Dr. Mohammad Mossadegh.

The colonial powers used to extract and benefit from Iran’s oil industry before nationalization of oil industry in the country.

During the 1890s, research and reports were being published that Iran had great oil potential. Some advisors of British tycoon William Knox D'Arcy made D'Arcy aware of these reports and promised him wealth if he invested in this venture. D'Arcy agreed and sent out representatives to Tehran to win a concession that would give him the exclusive rights to prospect for oil in Iran. On April 16, 1901, negotiations commenced between D'Arcy's representatives and Mozzafar al-Din Shah over the potential oil concession, Financial Tribune reported.

During this time period Great Britain and Russia had a great rivalry over the influence each wanted inside Persia. Both imperial powers believed that Persia and the Middle East were important to their imperial economic and military interests.

In 1901, William Knox D'Arcy and Mozzafar al-Din Shah of Iran signed an oil contract which was later named D'Arcy Concession.

D’Arcy Concession was a petroleum oil concession which gave D'Arcy the exclusive rights to prospect for oil in Iran.

During this exploration for oil, D'Arcy and his team encountered financial troubles and struggled to find sellable amounts of oil. They were about to give up but eventually struck large commercial quantities of oil in 1908. After these large commercial quantities of oil were found, the Anglo-Persian Oil Company took over the concession in 1909.

In 1909, shortly after the commercial quantities of oil were found, Burmah Oil thought that a new corporate structure needed to be created in order to work the concession. This led to the creation of the Anglo-Iranian Oil Company and Burmah Oil made it a publicly traded company, by selling shares off to the public in 1909. At this time Burmah Oil maintained control and the majority of the ordinary shares. For William Knox D'Arcy, he was compensated for his exploration costs and became a director of the new company, but as his role quickly faded out, D'Arcy began a subsidiary of the Anglo-Iranian company to look for further oil exploration sites.

The Anglo-Persian Oil Company (APOC) was a British company founded in 1908 following the discovery of a large oil field in Masjed Soleiman, Iran. It was the first company to extract petroleum from Iran. In 1935 APOC was renamed the Anglo-Iranian Oil Company (AIOC) and in 1954 it became the British Petroleum Company (BP), one of the antecedents of the modern BP public limited company.

In September 1941, the laborers of Iran’s South Oil company grouped in Khuzestan Oil Workers Syndicate to struggle against Britain’s colonial role in Iran’s oil industry.

Later in March 1951, the Iranian parliament voted to nationalize the Anglo-Iranian Oil Company (AIOC) and its holdings, and shortly thereafter the Iranian public elected a champion of nationalization, Mohammed Mossadegh, Prime Minister.

The nationalization of oil industry is celebrated every year in Iran from that time.