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On 26 May 1908, a British drilling crew working for William Knox D’Arcy struck oil at Masjed Soleiman in the foothills of the Zagros Mountains. It was the first major oil discovery in the Middle East, and it would transform Iran’s relationship with the outside world forever. Within a year, the Anglo-Persian Oil Company (APOC) was incorporated, and the machinery of foreign control over one of the world’s most strategically vital nations was set in motion. What followed over the next century was a sustained pattern of British, and later American, interference in Iranian sovereign affairs — a story of coups, concessions, sanctions, and calculated manipulation that continues to shape the modern world.
The D’Arcy Concession and the Birth of APOC (1901–1914)
The roots of Western interference predate the 1908 discovery itself. In 1901, the ailing Qajar monarch Mozaffar al-Din Shah granted William Knox D’Arcy — an Australian-born British financier — a sweeping 60-year concession to explore and exploit oil across nearly all of Iran. In exchange, Iran received £20,000 in cash, £20,000 in shares, and a promise of 16% of net profits. It was a profoundly asymmetrical arrangement, one that Iranians would spend the next half-century trying to undo.
Following the discovery of oil in commercial quantities in 1908, the Anglo-Persian Oil Company was formed a year later. In 1914, Winston Churchill, then First Lord of the Admiralty, oversaw the British government’s purchase of a 51% stake in APOC — a decisive moment that formally wedded British strategic interests to Iranian oil. The Royal Navy’s transition from coal to oil meant that Iranian reserves were no longer merely a commercial asset but a matter of imperial survival.
Iranian workers in the oil fields lived in conditions that shocked observers. Racially segregated housing, negligible wages compared to their British counterparts, and the near-total exclusion of Iranians from management positions made the oilfields a symbol of colonial exploitation at its most naked.
The Anglo-Russian Occupation and the Constitutional Crisis (1907–1921)
Even as Iranian reformers were fighting to establish a constitutional monarchy, the great powers were carving Iran up among themselves. The Anglo-Russian Convention of 1907 divided Iran into three zones: a Russian sphere of influence in the north, a British sphere in the south and east, and a nominally neutral belt in the middle. Iran was not consulted. The convention was signed in St Petersburg without a single Iranian representative present.
When Iran’s Constitutional Revolution of 1905–1911 threatened to produce a genuinely independent government capable of renegotiating foreign concessions, both Russia and Britain intervened to suppress it. Russian Cossack brigades, which served as the Iranian government’s own military force but were commanded by Russian officers, bombarded the parliament building in Tehran in 1908, temporarily ending the constitutional experiment. During the First World War, despite Iran’s declared neutrality, British, Russian, and Ottoman forces all fought on Iranian soil, causing widespread famine and the deaths of an estimated two million Iranians.
The Reza Shah Era and British Manipulation (1921–1941)
In 1921, a British-backed coup brought Reza Khan to power, a military officer who would eventually crown himself Reza Shah Pahlavi in 1925. The British, alarmed by Bolshevik influence from the north, had engineered the coup to install a strong, centralising leader who would protect their oil interests while keeping Soviet influence at bay. General Edmund Ironside, the British commander in Iran, played a direct role in facilitating Reza Khan’s seizure of power.
Reza Shah pursued modernisation with authoritarian zeal, but the oil question remained a source of festering resentment. In 1932, he cancelled the D’Arcy Concession in frustration at what Iran was being paid. Britain took the matter to the League of Nations. Rather than risk open confrontation, the dispute was settled with a revised agreement in 1933 — one that critics argued was barely more favourable than the original, having extended the concession to 1993 while increasing Iran’s royalties only modestly.
When the Second World War began, Reza Shah sought to maintain neutrality while retaining his German advisers, but Britain and the Soviet Union invaded Iran in August 1941. The operation took four days. Reza Shah was forced to abdicate and was exiled to South Africa, where he died in 1944. His 22-year-old son, Mohammad Reza, was placed on the throne as a more pliable successor. The message about Iranian sovereignty could not have been more explicit.
Mossadegh, Nationalisation, and the Coup of 1953
The most consequential act of Western interference in Iranian history — and arguably one of the most consequential in the history of the modern Middle East — came in August 1953. Mohammad Mosaddegh had become Prime Minister in 1951 on a platform of nationalising Iran’s oil industry. The Anglo-Iranian Oil Company (as APOC had been renamed in 1935) was generating enormous profits for Britain while Iranians saw very little. Mosaddegh’s government pushed through nationalisation in March 1951, and Iran took control of its own oil. He was named Time magazine’s Man of the Year.
Britain’s response was economic warfare. The Royal Navy blockaded Iran’s oil exports. Britain organised an international boycott and froze Iranian assets. The Attlee and then Churchill governments sought to persuade the United States to help remove Mosaddegh. Initially reluctant, the Truman administration declined. But the incoming Eisenhower administration, primed by Cold War anxieties and the argument that Mosaddegh’s weakness might open Iran to communist influence, agreed to participate.
Operation Ajax (American codename) and Operation Boot (British codename) was a joint CIA-MI6 covert operation. It involved bribing Iranian military officers, funding opposition newspapers, hiring mobs to create the appearance of public chaos, and orchestrating a royalist coup. On 19 August 1953, Mosaddegh was overthrown. He was tried for treason, spent three years in prison, and remained under house arrest until his death in 1967. Mohammad Reza Shah was restored to full power and ruled with increasing autocracy for another 26 years, backed by the United States.
The CIA formally acknowledged its role in the coup in 2013. The British government has still never issued a formal apology. The 1953 coup remains the central trauma of Iranian political consciousness and the foundational grievance underlying decades of hostility toward the West.
The Shah, SAVAK, and American Support (1953–1979)
The years following the coup saw Iran firmly integrated into American Cold War architecture. Mohammad Reza Shah received billions of dollars in military and economic aid. American advisers helped establish and train SAVAK, the Iranian secret police, which became notorious for the torture and imprisonment of political dissidents. Estimates of SAVAK’s victims vary widely, but its brutality was well-documented by Amnesty International and other human rights organisations long before the revolution.
The United States sold Iran increasingly sophisticated weapons systems. By the mid-1970s, Iran was the largest single purchaser of American arms in the world. President Nixon designated Iran as the primary guarantor of Western interests in the Persian Gulf following Britain’s 1971 withdrawal from east of Suez. The Shah became not merely a client but a regional power entrusted with maintaining order in one of the world’s most strategically critical waterways.
American and British support for the Shah continued even as his repression intensified. President Carter visited Tehran in December 1977 and toasted the Shah at a state dinner, calling Iran “an island of stability.” Thirteen months later, the Shah fled into exile as a mass revolutionary movement swept him from power.
The Revolution, the Hostage Crisis, and the Iran-Iraq War (1979–1988)
The Islamic Revolution of 1979 brought Ayatollah Khomeini to power and fundamentally reoriented Iran away from the Western alliance. When the Carter administration admitted the Shah to the United States for medical treatment, Iranian students seized the American embassy in Tehran, beginning a 444-day hostage crisis that consumed the final year of Carter’s presidency.
Western interference did not end with the revolution. When Saddam Hussein’s Iraq invaded Iran in September 1980, the United States and Britain tilted decisively toward Iraq. American intelligence was shared with Baghdad. Western governments allowed the sale of arms and dual-use technology. Most egregiously, the United States continued to support Iraq even after it became clear that Saddam Hussein was using chemical weapons against Iranian forces — attacks that killed tens of thousands. Declassified American documents have confirmed that the Reagan administration knew of Iraq’s chemical weapons use and did not withdraw its support.
In July 1988, the USS Vincennes, an American naval vessel operating in the Persian Gulf, shot down Iran Air Flight 655, killing all 290 passengers and crew. The Reagan administration maintained that the crew had mistaken the civilian airliner for an attacking military aircraft. Iran maintained it was a deliberate act. The United States never apologised; the commander of the Vincennes was later awarded a combat action ribbon.
Sanctions, Nuclear Politics, and the Long Squeeze (1990s–2020s)
The post-Cold War era brought new instruments of Western pressure to bear on Iran. American sanctions, first imposed after the hostage crisis, were progressively tightened. The Iran-Libya Sanctions Act of 1996 threatened penalties against foreign companies that invested in Iranian energy, extending American economic pressure extraterritorially. Iran’s nuclear programme, which had originally been initiated with American assistance under the Shah, became the central pretext for escalating international pressure.
The 2015 Joint Comprehensive Plan of Action — the nuclear deal — represented a rare moment of diplomatic engagement. Iran agreed to verifiable constraints on its nuclear programme in exchange for relief from international sanctions. The deal was signed by the United States, United Kingdom, France, Germany, Russia, China, and the European Union. By most accounts of international inspectors, Iran was complying with its terms.
In May 2018, the Trump administration unilaterally withdrew from the agreement and reimposed sweeping sanctions under a policy it termed “maximum pressure.” The sanctions targeted Iran’s oil exports, banking system, and access to international financial networks with the explicit aim of collapsing the Iranian economy. The effects on ordinary Iranians were severe: the currency lost roughly 60% of its value within months, inflation soared, and access to medicines and medical equipment was disrupted despite nominal humanitarian exemptions. The Biden administration sought to revive the deal but was unable to do so before leaving office.
Covert Operations in the Twenty-First Century
Western interference in the modern era has taken subtler but no less consequential forms. The Stuxnet cyberweapon, widely attributed to a joint American-Israeli operation, destroyed roughly a fifth of Iran’s nuclear centrifuges between 2009 and 2010. It was reportedly the first cyberweapon designed to cause physical destruction of infrastructure, and represented a significant escalation in covert operations against Iran.
A campaign of assassinations targeting Iranian nuclear scientists killed at least five between 2010 and 2012. The attacks were attributed to Israel, with suggested American knowledge. In January 2020, the United States assassinated General Qasem Soleimani, the commander of the Quds Force and one of the most powerful figures in the Iranian state, in a drone strike at Baghdad airport. The Trump administration justified the killing as defensive; Iran and much of the international community condemned it as an illegal act of state aggression.
Conclusion: The Long Shadow of 1909
The discovery of oil in Iran in 1908 set in motion a relationship between Iran and the Western powers defined by extraction, manipulation, and recurring betrayal. Britain spent the first half of the twentieth century treating Iran as a possession to be managed. America spent the second half treating it as a strategic asset to be controlled, then an adversary to be contained.
To understand modern Iran — its suspicion of Western intentions, its clerical government’s rhetorical hostility toward both Britain and the United States, the depth of popular sentiment around national sovereignty — it is essential to understand this history. The resentments that drive Iranian politics are not irrational or manufactured. They are the accumulated residue of a century of documented interference, from the Anglo-Russian Convention to the 1953 coup, from SAVAK to maximum pressure.
This does not make the Iranian government blameless in its own conduct, nor does it resolve the genuine and serious concerns that Western governments raise about Iran’s nuclear programme, its regional activities, or its human rights record. But it does mean that any honest accounting of the Iran-West relationship must begin with what the West has done — and what it has long refused to fully acknowledge.
The oil that William Knox D’Arcy’s drillers found beneath the Zagros Mountains has been both Iran’s blessing and its curse. It brought the world to Iran’s door — and Iran has been paying the price ever since.
