Urban Sights: Urban History and Visual Culture

Origins of Iraqi oil

Oil extraction for lamps from hand-dug pits had been a practice of local residents in the Ottoman province of Mosul since the middle of the nineteenth century. By 1899, a British geological survey confirmed high potential for rich petroleum deposits to be accessible and abundant in the area. Originally, Deutsche Bank purchased concessions to develop oil and a railway in Mosul and Baghdad provinces from the Ottoman government; however, the Bank failed to move forward with the project. Timothy Mitchell argues this was no accident as the German investors actually intended to block development of the region’s 'inexhaustible supply' of oil for fear that it would flood the European market.

In 1914, after years of competition between British and German interests, a new deal was struck between the Ottoman government and a consortium of British financiers for future discovery and development of oil in Mosul and Baghdad provinces. The British group partnered with Deutsche Bank alongside Compagnie Française des Pétroles and the Royal Dutch Shell Oil Company to form a new consortium: the Turkish Petroleum Company (TPC).
The Anglo-Persian (later Anglo-Iranian) Oil Company acquired majority shares of the TPC by 1914 and was thereafter the largest single company shareholder. In fact, the British government was Anglo-Persian’s majority stakeholder and maintained chief control and interest in the company. At this point, the two major oil companies positioned to explore and exploit oil from the regions of Persia and Mesopotamia (Anglo-Persian and TPC respectively) were effectively direct extensions of the British government. Mitchell illuminates the symbiotic relationship between the companies and the imperial state in this regard: 
Petroleum companies were never strong enough to monopolise the flow or stoppage of oil by themselves. They needed outside help, both military and financial. To draw on the resources of well-armed states and government treasuries, Western oil companies began to describe their control of overseas oil as an ‘imperial’ interest of the state, or in later language as a ‘strategic’ interest, and thus somehow beneficial to the public well-being. 
In order to warrant its hegemony over oil resources after the collapse of the Ottoman Empire, Britain was pressed to maintain control over the territories that it had claimed during the San Remo conference in 1920. Namely, this included the former Ottoman provinces of Mosul, Baghdad and Basra that comprised the British mandate. This arrangement empowered TPC, and thus the British government, with an easy avenue to govern the development and exploitation of Iraq’s northern oil fields near Kirkuk. In 1921, British authorities installed the Hashemite monarch as Iraq’s formal ruler and within five years the Turkish Petroleum Company obtained concessions for exploration within Iraq’s national borders.

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