To the Editor:

According to a news report, our State Department is again meddling in the affairs of a sovereign nation. In this case it is intervention in the dispute of Iran with the Anglo-Iranian Oil Company. Our State Department is attempting to exert pressure on Iran, arguing that Iran should consider whether the elimination of the established British oil company would in fact secure for Iran the greatest possible benefits, and that the result of such action might well be a decrease in the sale of Iranian oil, with a loss of revenue to Iran. Such chicanery!

Very recent publication of figures said to have been obtained from a secret report of the Anglo-Iranian Oil Company indicated that for the year 1950 this company’s profit amounted to $400,000,000, of which the British Government took $230,000,000 in taxes, whereas Iran received only $30,000,000 an its share in payment of this oil. This division of the profit would be total equivalent to 93 per cent to the oil company, and only 7 per cent to Iran. No wonder Iran wants to nationalize its oil!

On this basis, contrary to our State Department’s argument, it is evident that a tremendous decrease in the sale of Iranian produced oil under state ownership would provide Iran with greater revenue than under the present inequitable lopsided contract arrangement. A contract such this would probably be considered fraudulent in an American court of equity by reason of having taken one party scrupulous unfair and un-advantage the other party to the contract.

It seems to me that the demand for this much needed Iranian oil is great enough for Iran to readily sell it in the world market, and that contrary to our State Department, a sufficient number of petroleum technicians could be obtained to operate these Iranian wells under state ownership by offer of sufficient compensation to be attractive.

Will we ever learn to attend entirely to our own affairs and avoid foreign entanglements?

BERT A. DOERING.

To the Editor:

May I comment on Mr. Doering’s letter criticising the Anglo-Iranian Oil Company which appeared in your issue of May 26?

Mr. Doering stated that recent publication of figures obtained from a secret report of the company’s operations for 1950 indicated that in that year the company’s profit from Iranian oil amounted to $400,000,000, of which the British Government took $230,000,000 for taxes, whereas the Iranian Government received only $30,000,000. He attributed the current agitation in Iran for nationalization of the oil industry to the inequitable distribution of profits.

Mr. Doering does not say where or when these figures were published. But there are certain facts which seem to cast a good deal of doubt on their accuracy. The Anglo-Iranian official statement of accounts for 1950 has not yet been published, but their statement for 1949 shows that their total trading profits for that year were $115,300,000, of which British Government income tax took $63,800,000, leaving the company $51,500,000. The Iranian Government received in royalties and other payments from the company about $70,000,000. Royalties alone were $37,800,000.

Since operations were conducted under the same agreement between the company and the Iranian Government in 1950 as in 1949, it is reasonable to assume that the proportional distribution of profits and royalties in both years was much the same. It seems, therefore, that the company’s profits were much smaller and their payments to the Iranian Government much larger than Mr. Doering suggests.

As far as I know, no one has questioned the accuracy of the company’s 1949 balance sheet. At all events, I am sure that Mr. Doering will agree that it the Iranian Government had actually received less than the company alleged, it would have made the fact known.

The importance of these oil royalties to the whole Iranian economy is underlined by the statement in Mr. George Sokolsky’s column entitled “American Policy in Iran”; also in your issue of May 26, that “The Anglo-Iranian company provides about 5 per cent of the national revenue through royalties and taxes and about 60 per cent of the nation’s foreign exchange.” [syndicated column]

Payments by the company to the Iranian Government over the past three years would have been even larger if the supplemental agreement, increasing royalty rates, which the company proposed and the Iranian Government accepted, had ever been put into effect. In fact, the Iranian Government would have received in all about $70,000,000 in royalties. But the Iranian Parliament refused to ratify the agreement

W. B. LEDWIDGE,
British Consul.