The Middle East, Oil, and the Great Powers

I N APPROACHING the issue of oil development in northern Iran, one must keep in mind the physical conditions involved. Should oil be found in the north, there are only two ways of bringing it to international markets. One is over the Zagros Mountains to a port on the Persian Gulf, which would be so expensive as to make the undertaking almost prohibitive; the other is to Baku and across the Caucasus to the Black Sea, and thence by tanker through the Straits to the Mediterranean -- this would of course depend on Russian consent and goodwill.¹ Whenever, therefore, the issue of the development of petroleum came into consideration, physical as well as political factors had to be reckoned with.

As will be recalled, the original D'Arcy concession exempted the five northern provinces from the concession because they were considered, even as early as 1901, under Russian influence. The Russians on their part, it would seem, made no attempt to develop the oil resources of these provinces and consequently sought no concessions, at least until 1916.

On March 9 of that year Premier Sepahsalar granted A. M. Khoshtaria, at that time a Russian subject, a seventy-year concession to exploit petroleum and natural gases in the provinces of Gilan, Mazanderan and Astrabad.² Vossugh ed-Dowleh, who became Premier the following year, confirmed the concession.³

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