Iranian Oil Crisis Remains Unsolved
Drew Pearson — January 18, 1952

The Mossadegh Project | May 4, 2016                    

While British Prime Minister Winston Churchill was visiting the United States, this was the opening section of Drew Pearson’s widely syndicated column The Washington Merry-Go-Round.

Uncle Sam Must Pay the Bill
For British Oil Losses In Iran

Drew Pearson WASHINGTON — One unpleasant shadow lurking over the Churchill-Truman conversations is that American taxpayers are to be called upon to pick up the tab for the closing down of the Abadan oil refinery.

While this has not been spelled out in so many words during the Churchill visit, it remains a fact that the U.S. government has been euchred into a position where it is going to pay for British mistakes in Iran and the closing of an oil refinery which produced 20 per cent of all refined products outside the United States.

No real steps to solve this situation have been taken during the Prime Minister’s visit.


Meanwhile, though the American people do not realize it, the United States is helping supply to the Anglo-Iranian oil company 500,000 barrels of refined oil products daily in order to make up for the loss at Abadan.

Meanwhile also, dollars are being drained out of Britain at the rate of $600,000,000 annually to pay for this oil. Reports from London have told of the alarming exit of British dollar reserves in the last few months, but they have not fully explained the reason for this increased drain. Chief reason for the increase is the shutdown of the Abadan refinery.


Previously the oil sold by the Anglo-Iranian company — owned and operated by the British government — represented important revenue for Britain. But, with the refinery closed, Anglo-Iranian has had to buy 300,000 barrels of oil daily from the Caribbean and the United States, plus 200,000 barrels from other sources. This has to be paid for in dollars.

American companies have formed a foreign petroleum supply committee, under the sponsorship of the State Department and the Interior Department, to step in and make up the Iranian oil deficit. This means that we are not only drawing on our own oil reserves, despite a national policy to discourage exports, but simultaneously we are put in the position of soon having to make up Britain’s cash reserves now being exhausted because of the Anglo-Iranian oil crisis.

There are two other tragic aspects to the British-Iranian dispute:

No. 1 — The Abadan shutdown could have been prevented had the State department taken the advice of Justice William O. Douglas who visited Iran two years ago and clearly warned what was going to happen.

No. 2 — Premier Mossadegh and Iran are being driven into the arms of Soviet Russia.

Mossadegh happens to be a long and courageous battler against communism and Russian influence. It was he who blocked confirmation of the 1949 treaty between Iran and Russia giving the Soviet power to exploit oil in northern Iran. It was he also who threw out the Russian puppet-rulers of Azerbaijan.


But steady efforts by the British to starve out Iran have gradually driven Mossadegh and the Iranian people toward the Russians. [Not the case] Simultaneously, the economic crisis has increased U.S. aid to Iran.

Thus the American taxpayer gets the hairy end of the lollypop all the way round: (1) by losing more American oil; (2) by bailing out Britain’s dwindling dollar reserves; (3) by bolstering Iran’s economy.

These are some of the things which were not solved during the Churchill visit — perhaps because there was too much delicacy on the part of some diplomats.

Alternate titles:

Iran Mistakes
U.S. Taxpayer Pays The Bill
The Anglo-Iranian Oil Squeeze
U.S. To Pay For British Mistakes In Iran
Britain’s Dollar Drains And Iran’s Crisis Still Unresolved
U.S. Taxpayers Foot the Bill For British Losses in Iran
Iranian Oil Crisis Weakens British Economic Position And Drains Off More U.S. Dollars as Indirect Result
No Solution Of Britain’s Dollar Drains And Iranian Crisis During Churchill Visit; Taxpayers Will Have To Make Up Loss From Refinery


Related links:

A Wise Decision | Miami Daily News, October 4, 1951

Premier Of Iran Even Outdoing Russians With His Rudeness | Drew Pearson, Sept. 11, 1952

Pres. Truman: “I’m always hoping for peace everywhere in the world” (Sept. 27, 1951)

MOSSADEGH t-shirts — “If I sit silently, I have sinned”

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