There was once a democracy in Iran. People worked hard and they wanted to gain something out of their effort. However, this hope all started to crumble when young Shah decided to sell concessions to Britain. He sold merchants the right to control over the nation’s most valuable assets, which are the “mineral-prospecting rights”, “right to establish banks” and “right to commerce along the Karun River, the only navigable waterway in Iran” (31). This made the Iranians mad, yet they still had fate within the government and supported Shah’s decision. However, he inflames the Iranians mind to his side, Shah granted the first concession which shaped Iran’s history completely, which was selling the right to the oil in most of Iran in exchange for sixteen percent of the profits to William Knox D’Arcy (48) He was a London-based financier who had the “special and exclusive privilege to obtain, exploit, develop, render suitable for trade, carry away and sell natural gas [and] petroleum...for a term of sixty years” (33). The consciousness of Iranians grew enormously and started to question their religious belief, that God requires leaders to rule justly, a central tenet of Shiite doctrine. Meanwhile, the spark came in December 1905, when the merchants were captured in a dispute over sugar prices. The riot was formed and protested toward the government to ask the political power of Majlis. Shah finally approves this request but he makes law that all the decisions made by Majlis must have Shah’s signature to proceed. This new constitution changed not only the law of Iran but also the way that Iranians were thinking about government. They have became citizens, not just subjects of the monarch. In 1907, Britain and Russia signed a treaty about separating control of Iran into southern provinces and Northern provinces. Russia claimed the northern Iran and Britain claimed southern Iran. Iran was being notified by them and this foreign influence weakened the new constitutional form of government (38). Shah and protesters seems fine, until large quantity oil was found in the autumn of 1908. The wells were drilled and extracted millions of barrels of oil through hundred miles of pipelines. The British government steps in and becomes the largest shareholder in the company. And Iranian got furious at foreign concessions increases.
The place it was found was Abadan, where there were no development done yet. So people moved in, with a lot of investment. Soon, power-generating stations, several stores, and workshops, a water filtration plant, and even a small railway were built (50).
Along the way, the concession was redefined once again, which extended it thirty two years longer and changed its name from Anglo-Persian to Anglo-Iranian Oil Company.
In 1933 accord stabilized the oil company’s position for the rest of Reza Shah’s reign (52). Everything seemed fine. It was win-win situation to both Britain and to Shah himself, yet it was not going well, as the superiors were thinking. And this became a big problem later in 1946. By the late 1940s, Iran was the world’s fourth largest oil exporter, but the British-owned Anglo-Iranian Oil Company (AIOC) was controlling the production (94). When riots break out at the refinery in Abadan in 1946, the Iranian public demanded a renegotiation of Iran’s arrangement with the AIOC. They were on strike. This…