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Hard to believe Churchill was one of the early developers of that field. Fascinating history. "In 1913, shortly before World War I, APOC managers negotiated wi

by Hilift 1y ago

Hard to believe Churchill was one of the early developers of that field. Fascinating history. "In 1913, shortly before World War I, APOC managers negotiated with a new customer, Winston Churchill, who was then First Lord of the Admiralty. Churchill, as a part of a three-year expansion program, sought to modernise Britain's Royal Navy by abandoning the use of coal-fired steamships and adopting oil as fuel..." "Persian popular opposition to the D'Arcy oil concession and royalty terms whereby Persia only received 16% of net profits was widespread." "By the end of April 1933, a new agreement was finally forged. The concession area was reduced by three-quarters. Persia was guaranteed a fixed royalty of four shillings per ton, which protected it against fluctuations in oil prices. At the same time, it would receive 20 percent of the company's worldwide profits that were actually distributed to shareholders above a certain minimum sum. In addition, a minimum annual payment of £750,000, irrespective of other developments, was guaranteed." "Truman and US ambassador to Iran Henry F. Grady opposed intervention in Iran but needed Britain's support for the Korean War." "BP was incorporated in London in 1954 as a holding company called Iranian Oil Participants Ltd (IOP).[41][42] The founding members of IOP included British Petroleum (40%), Gulf Oil (8%), Royal Dutch Shell (14%), and Compagnie Française des Pétroles (now TotalEnergies SE, 6%). The four Aramco partners — Standard Oil of California (SoCal, later Chevron), Standard Oil of New Jersey (later Exxon), Standard Oil Co. of New York (later Mobil), and Texaco – each held an 8% stake in the holding company.[41][43] In addition, these companies paid Anglo-Iranian about $90 million for their 60 percent share in the consortium, and a further $500 million, paid out of a ten cent per barrel royalty. The Shah signed the agreement on 29 October 1954, and oil flowed from Abadan the next day. Within a few months each of the American companies contributed 1 percent to Iricon, a consortium made up of nine independent American companies, which included Phillips, Richfield, Standard of Ohio, and Ashland." https://en.wikipedia.org/wiki/Anglo-Persian_Oil_Company https://en.wikipedia.org/wiki/Anglo-Persian_Oil_Company

rayiner 1y ago
The history of oil development is so poorly known in the Arab world. The prevailing view is “the British came in and took our oil.” But everyone overlooks that the Arab countries had never developed the mechanical technology to really extract it except the portion that came near the surface.
- Aspos 1y ago
  One does not need to develop the tech to own the oil and monetize it. Those who developed the tech can be hired.
  - rayiner 1y ago
    Your options are limited when you have none of the tech stack to find the oil, development fields, and extract the oil. Nor the capital to buy the equipment and do it all yourself. Theoretically, book authors could “hire” everyone needed to turn a popular book into a movie. But in practice they sell the rights to develop the property to a studio in return for a cut of the profits.
    - pazimzadeh 1y ago
      Finding the oil fields was often easy. The soil was oily to the touch. The Arabs were using the oil for lamps for a while (think Aladdin’s lamp).
      - AftHurrahWinch 1y ago
        Aladdin's lamp would have been an olive-oil lamp. Flammable vapor lamps are comparatively modern. Before the Renaissance, rock-oil/petroleum was used mostly for waterproofing as tar, with a few other medicinal and military uses.
        pazimzadeh 1y ago
        Highly doubt it was olive oil. But naphta was used as wicks for lanterns and oil and natural gas were burned thousands of years ago. The real point is not what the oil was used for, but that the oil fields were not particularly hard to find. From Alexander the Great to Al Masudi, there are plenty of records of oil pools and puddles throughout Persia and Arabia https://archive.aramcoworld.com/issue/199505/land.of.the.naphtha.fountain.htm https://archive.aramcoworld.com/issue/199505/land.of.the.nap... https://www.cyberistan.org/islamic/islmoil1.html https://www.cyberistan.org/islamic/islmoil1.html
cyberax 1y ago
Another interesting tidbit: https://russia-islworld.ru/en/kultura/karim-hakimov-red-pasha-and-the-arabian-vizier-of-the-kremlin/ https://russia-islworld.ru/en/kultura/karim-hakimov-red-pash... In 1930-s there was a chance for Saudi Arabia to become close with the USSR. It had diplomatic relations and wanted assistance from the USSR, in particular in obtaining enough fuel.
- trhway 1y ago
  fascinating, the time when USSR repressions impressed even Saudis (by watching for example Lawrence of Arabia one can see that life there was a complete opposite of a cake walk) : "one year later he was recalled to Moscow where he was arrested one year later on the false denunciation. On the 10th of January in 1938 Red Pasha was cut short. Repressions of «Red Pasha» and the follow-up execution made a great impression on representatives of the ruling till now dynasty of the Saudi Arabia Kingdom – diplomatic relations between that country and the USSR were broken off in 1938 after Khakimov’s withdrawal and they were not resumed till the fall of the communist system in the Soviet Union."
dredmorbius 1y ago
Churchill's role in expanding the role of oil was in fact profound. It's another fact I'd learned in Yergin's The Prize (mentioned elsewhere in this thread). Britain was a naval power, and in the early 20th century was rich in several factors that served as a basis for that, including iron and coal, as well as access (through trade) to the essentials of munitions manufacture (saltpetre, an ingredient in gunpowder and other propellants, was abundant in India). But coal-fired ships were cumbersome to manage: solid coal had to be physically handled when fueling ships initially, in re-bunkering coal as it was consumed in transit, and of course, being shoveled into the boilers themselves. Petroleum, by contrast, flowed through pipes, by gravity or with the assistance of pumps. Fueling, bunkering, and operational procedures were streamlined remarkably. Ships also gained vastly greater performance flexibility: direct-combustion engines (diesel or turbine) could be powered up or down in seconds, rather than the many minutes or hours to increase steam-based output. And of course petroleum enabled the two great 20th century advances in naval power: submarines and aircraft, of which the technological history of coal-fired variants is brief. (Not non-existant, however. The British Navy deployed K-Class submarines, coal powered, in WWI, and the Germans experimented with a coal-dust burning airplane in WWII, see <https://en.wikipedia.org/wiki/British_K-class_submarine https://en.wikipedia.org/wiki/British_K-class_submarine> and <https://en.wikipedia.org/wiki/Lippisch_P.13a https://en.wikipedia.org/wiki/Lippisch_P.13a>.) Britain's problem in 1913 however was that the country had no domestic oil production capacity. (The North Sea oil fields wouldn't be proven and developed until the 1960s.) Switching from (domestic) coal to (foreign) oil was a tremendous gamble, and required sea-lane control to the Middle East, as well as control of the Suez Canal for greatly-reduced shipping costs. The story of oil in both World Wars is probably the most fascinating aspect of Yergin's book. WWI in particular started with cavalry charges and horsecarts, and ended with tanks, submarines, and bombers. During WWII, a critical element in the Allied invasion of mainland Europe was the establishment of an oil pipeline, in Operation Pluto, initially consisting of a single two inch diameter cross-channel pipe. Through those two inches flowed the material which made mechanised invasion possible. <https://en.wikipedia.org/wiki/Operation_Pluto https://en.wikipedia.org/wiki/Operation_Pluto> (Appropriation of German "Jerry Cans" --- Wehrmacht-Einheitskanister to its creators --- was also a huge strategic gain. <https://en.wikipedia.org/wiki/Jerrycan https://en.wikipedia.org/wiki/Jerrycan>)

by Hilift 1y ago

rayiner 1y ago

The history of oil development is so poorly known in the Arab world. The prevailing view is “the British came in and took our oil.” But everyone overlooks that the Arab countries had never developed the mechanical technology to really extract it except the portion that came near the surface.

Aspos 1y ago
One does not need to develop the tech to own the oil and monetize it. Those who developed the tech can be hired.
- rayiner 1y ago
  Your options are limited when you have none of the tech stack to find the oil, development fields, and extract the oil. Nor the capital to buy the equipment and do it all yourself. Theoretically, book authors could “hire” everyone needed to turn a popular book into a movie. But in practice they sell the rights to develop the property to a studio in return for a cut of the profits.
  - pazimzadeh 1y ago
    Finding the oil fields was often easy. The soil was oily to the touch. The Arabs were using the oil for lamps for a while (think Aladdin’s lamp).
    - AftHurrahWinch 1y ago
      Aladdin's lamp would have been an olive-oil lamp. Flammable vapor lamps are comparatively modern. Before the Renaissance, rock-oil/petroleum was used mostly for waterproofing as tar, with a few other medicinal and military uses.
      - pazimzadeh 1y ago
        Highly doubt it was olive oil. But naphta was used as wicks for lanterns and oil and natural gas were burned thousands of years ago. The real point is not what the oil was used for, but that the oil fields were not particularly hard to find. From Alexander the Great to Al Masudi, there are plenty of records of oil pools and puddles throughout Persia and Arabia https://archive.aramcoworld.com/issue/199505/land.of.the.naphtha.fountain.htm https://archive.aramcoworld.com/issue/199505/land.of.the.nap... https://www.cyberistan.org/islamic/islmoil1.html https://www.cyberistan.org/islamic/islmoil1.html

cyberax 1y ago

Another interesting tidbit: https://russia-islworld.ru/en/kultura/karim-hakimov-red-pasha-and-the-arabian-vizier-of-the-kremlin/ https://russia-islworld.ru/en/kultura/karim-hakimov-red-pash... In 1930-s there was a chance for Saudi Arabia to become close with the USSR. It had diplomatic relations and wanted assistance from the USSR, in particular in obtaining enough fuel.

trhway 1y ago
fascinating, the time when USSR repressions impressed even Saudis (by watching for example Lawrence of Arabia one can see that life there was a complete opposite of a cake walk) : "one year later he was recalled to Moscow where he was arrested one year later on the false denunciation. On the 10th of January in 1938 Red Pasha was cut short. Repressions of «Red Pasha» and the follow-up execution made a great impression on representatives of the ruling till now dynasty of the Saudi Arabia Kingdom – diplomatic relations between that country and the USSR were broken off in 1938 after Khakimov’s withdrawal and they were not resumed till the fall of the communist system in the Soviet Union."

dredmorbius 1y ago

Churchill's role in expanding the role of oil was in fact profound. It's another fact I'd learned in Yergin's The Prize (mentioned elsewhere in this thread). Britain was a naval power, and in the early 20th century was rich in several factors that served as a basis for that, including iron and coal, as well as access (through trade) to the essentials of munitions manufacture (saltpetre, an ingredient in gunpowder and other propellants, was abundant in India). But coal-fired ships were cumbersome to manage: solid coal had to be physically handled when fueling ships initially, in re-bunkering coal as it was consumed in transit, and of course, being shoveled into the boilers themselves. Petroleum, by contrast, flowed through pipes, by gravity or with the assistance of pumps. Fueling, bunkering, and operational procedures were streamlined remarkably. Ships also gained vastly greater performance flexibility: direct-combustion engines (diesel or turbine) could be powered up or down in seconds, rather than the many minutes or hours to increase steam-based output. And of course petroleum enabled the two great 20th century advances in naval power: submarines and aircraft, of which the technological history of coal-fired variants is brief. (Not non-existant, however. The British Navy deployed K-Class submarines, coal powered, in WWI, and the Germans experimented with a coal-dust burning airplane in WWII, see <https://en.wikipedia.org/wiki/British_K-class_submarine https://en.wikipedia.org/wiki/British_K-class_submarine> and <https://en.wikipedia.org/wiki/Lippisch_P.13a https://en.wikipedia.org/wiki/Lippisch_P.13a>.) Britain's problem in 1913 however was that the country had no domestic oil production capacity. (The North Sea oil fields wouldn't be proven and developed until the 1960s.) Switching from (domestic) coal to (foreign) oil was a tremendous gamble, and required sea-lane control to the Middle East, as well as control of the Suez Canal for greatly-reduced shipping costs. The story of oil in both World Wars is probably the most fascinating aspect of Yergin's book. WWI in particular started with cavalry charges and horsecarts, and ended with tanks, submarines, and bombers. During WWII, a critical element in the Allied invasion of mainland Europe was the establishment of an oil pipeline, in Operation Pluto, initially consisting of a single two inch diameter cross-channel pipe. Through those two inches flowed the material which made mechanised invasion possible. <https://en.wikipedia.org/wiki/Operation_Pluto https://en.wikipedia.org/wiki/Operation_Pluto> (Appropriation of German "Jerry Cans" --- Wehrmacht-Einheitskanister to its creators --- was also a huge strategic gain. <https://en.wikipedia.org/wiki/Jerrycan https://en.wikipedia.org/wiki/Jerrycan>)