That Double Crosser

August 14, 1952 — Ludwell Denny

Arash Norouzi

The Mossadegh Project | November 18, 2022                    

Ludwell Howard Denny (1894-1970) was an Indiana born journalist, author and former Unitarian minister. He was also a foreign editor for Scripps-Howard news service, which distributed his factually loose newspaper column. Among his books was We Fight For Oil (1928), much of which covered the Anglo-Persian Oil Company (then AIOC).

BLACKMAIL . . . By Ludwell Denny

Iran, U.S. And Britain
Deadlocked Over Oil

WASHINGTON — Fresh from his success in blackmailing the Iranian parliament into granting him almost unlimited powers, Dictator Mohammed Mossadegh is now blackmailing Britain and the United States to subsidize his bankrupt anti-foreign regime.

Do what I say or I’ll turn Iran over to the Communists—this, in effect, is his threat. It may work in London and Washington, as it worked in Teheran. But first the U.S. government, no less than the British, wants more guarantees than are yet apparent.

MOSSADEGH has double-crossed Washington and London repeatedly in the past year. This has not left them in an agreeable mood.

Nevertheless, they are deeply concerned about the danger of Communist control of that highly strategic country—more concerned than at any time in the past. Mossadegh knows this. And he is playing it for all he is worth.

His immediate demand is that Britain give him upward of $150 million in royalties which it is holding against his expropriation of the Anglo-Iranian oil properties, [AIOC] and that it lift its world ban on his sale of the oil seized without compensation.

At the same time he is demanding a $50 million loan from the United States to finance his illegal marketing of the British oil.

NEITHER LONDON nor Washington challenges Iran’s right to expropriate foreign properties. But both deny the right to nationalize oil fields and refineries without compensation and without due legal process. That is what the deadlock is about.

Several favorable compromises have been offered to Mossadegh. These would recognize Iranian ownership of the resources, and allow a mixed or international operating company to produce and market the oil with some of the profits going to pay off the British claims. When he rejected all other such proposals, the World Bank finally offered to operate the properties pending a settlement. But he refused that also.

Mossadegh’s theory was that he could run the wells and refinery with German or Soviet technicians, and that world tankers would race into Abadan to buy the oil. Instead, he has been unable after a year to operate adequately or to market any of the product. At best he has only a marginal production and market in prospect.

Meanwhile neighboring countries have increased their production rapidly. Mid-East total output is larger now, without any Iranian oil, than it was in the lush days of Anglo-Iranian production. Even the more serious shortage in refinery capacity is being overcome. So Mossadegh’s bargaining power on oil is less than ever.

BUT HIS threat of turning the country over to Stalin’s Tudeh (Communist) party is something else again. [Soviet Premier Joseph Stalin]

America and Britain are willing to bribe him to prevent that, provided:

ONE—The bribe is in a form which will not encourage other Mid-East countries to expropriate American and British oil holdings without compensation.

TWO—He does not double-cross them again—and co-operate with the Reds as he did two weeks ago, and on earlier occasions.

THREE—He is not simply a front for the mad Mullah Kashani—and thus unable to keep a bargain with us even if he wants to.

What Went Wrong in Iran? | Amb. Henry Grady Tells All (1952)
What Went Wrong in Iran? | Saturday Evening Post, Jan. 5, 1952


Related links:

Mossadegh Uses Mild Blackmail | November 17, 1951 editorial

Dry Those Big Tears, Mr. Mossadegh | The Calgary Herald, June 18, 1951

Iran on a Limb | Oakland Tribune, February 27, 1952

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

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