Dr. Mohammed Mossadegh will depart for Tehran this coming Sunday with the great issue he came here to explore still very much up in the air. The State Department has announced officially its regretful conclusion that no solution to the oil dispute between Iran and Great Britain is in sight. Instead of an agreement that would permit a resumption of the flow of oil through the huge refinery at Abadan, and hence a resumption of the flow of revenue into the sagging Iranian economy, the Prime Minister will take back with him merely an emergency credit which can ease his country’s financial position only temporarily.

As international transactions go, the credit that the International Monetary Fund has agreed to allow Iran is small. Nor does it bulk particularly large in terms of the credits which the International Monetary Fund has already extended, about $800,000,000. It is a relatively small sum when set against the yearly royalties that Iran would have got under the last British proposal, about $85,000,000.

That Iran is short of foreign exchange is unquestionable. Since the British pulled out, they have had virtually no oil sales. In addition, they have missed the $125,000,000 or so that awaits them in previously accumulated royalties. But the question that arises is whether the Iranian foreign-exchange shortage is in fact temporary.

Much has happened in the other Middle Eastern countries since Iranian production stopped. The Defense Petroleum Administration reports that other British and American companies have increased crude-oil production in other Middle Eastern areas by 270,000 barrels a day, as against the 150,000 barrels of crude oil that Iran produced.

For the Iranians to retrieve the oil markets they have lost to their neighbors will be difficult. The one bright spot, from the Iranian point of view, is that even though crude production has made up for the Iranian output, there is still a severe shortage of the refined product that used to come out of Abadan.

In making public its conclusion that no end to the oil dispute can presently be seen, the State Department still insists that progress has been made in exploring the points at issue. The hope must be that, in spite of indications to the contrary, the internal political situation in Iran has not deteriorated so badly that no equitable solution would be acceptable to a people whose emotions have been aroused to an irrational pitch. It is a thin hope, but all parties to the dispute stand to suffer unless it is realized.