History of Oil Nationalization

Nationalization of Oil : Its Challenges and Dangers

It has been said that if people in the present will not take time to study the past , then they will be doomed to repeat it . In reality though , no one pays attention about history until a similar problem in the past is being felt in the present , a bad case of dyja vu . For almost the entirety of the 20th century the whole world became well acquainted with a new phenomenon the planet 's overdependence on petroleum products The same thing is happening today and

just like in the past , the common belief is that the energy crisis was brought upon by the capriciousness of oil exporting countries . But an in-depth study of six articles will reveal that the energy crisis is the direct result of oil exporting countries working with a U .S . led oil cartel . The contentious partnership is characterized by self-serving politics , greed and incompetence

Background

It was only after World War I when Europe and America fully realized the great importance of petroleum deposits and the need to control and access oil fields . The United States was the major reason why allied forces won the war but Britain moved first to secure Iran 's petroleum deposits on the strength of a concession granted to them in 1901 (Stork 1973 , 4 . As a result Britain controlled the fourth largest oil producing country after the United States , Russia , and Venezuela . The British government exploited the incompetence of a weak and corrupt Persian government in to secure a one-sided concession

Moreover , after World War I and the defeat of Germany , France and Britain proceeded to carve up the Middle East and created a modified colonial system when they subdivided German and Ottoman territories Syria and Lebanon will be ruled by France while Palestine and Iraq will be ruled by Britain . Needless to say the only way that this kind of arrangement would work is through the suppression of the local political forces (Stork , 1973 , 6 . It is now clear why the Arab world will strike back after decades of receiving the short end of the stick

France and Britain could easily justify what they had done to Middle East because to the victors goes the spoils of war . It took the United States more than a decade to take part in this mad scramble for foreign oil . This is due to the fact that Texas , Louisiana and California are producing large quantities of oil in the 1920s so much so .that the U .S . is supplying 68 of the world 's crude oil (Stork , 1973 , 8 Before the end of the 1920s a powerful American oil cartel composed of Jersey Standard and Socony (Mobil ) went into partnership with British and French companies to form a much bigger cartel called Turkish Petroleum Company and was later renamed to Iraq Petroleum Company . This is the beginning of how three superpowers - Britain , France , and the United States - began controlling oil in the...