British Diplomatic Oil Crisis: Contemporary Anglo-Saxon Geopolitical Rivalries in the Persian Gulf: Drawing a Lesson? Or Sir Anthony Eden‘s Delusion of Grandeur.

British Diplomatic Oil Crisis: Contemporary Anglo-Saxon Geopolitical Rivalries in the Persian Gulf: Drawing a Lesson? Or Sir Anthony Eden‘s Delusion of Grandeur.

Since some
rioters were even calling openly for a republic, the use
of force in the Shah’s view would definitely jeopardise his own
position. On 21st July 1952, Qavam resigned. The following day
Musaddiq returned to position. On 3rd August 1952 the Prime Minister
asked the Majlis to be granted full powers. His request was accepted
by the Majlis.

Due to
the lack of oil revenue, the financial situation in Iran
deteriorated. The British Government has also frozen Iran’s sterling
fund in the UK. There was a huge budget deficit which was
exacerbated by the Iranian Government’s subsidisation of the oil
workers. In September 1952, Dr. Musaddiq, the Iranian Prime
Minister, invited Dr. Hjalmar Schacht, the German financial expert,
to Iran for consultation. At the end of his four-day visit to Iran
Dr. Schacht announced that he had been asked to prepare a new
economic plan for Iran. Following Schacht, Camille Gutt, former
Belgian Minister of Finance and director of the International
Monetary Fund, who had been recommended to the Iranian Prime
Minister by Trygve Lie, Secretary-General of the United Nations,
visited Iran by the beginning of October. Camille Gutt’s purpose was
to examine Iran’s economy in detail. The results of either of these
two missions were not concrete.

Later in
October, the Majlis voted to dissolve the Senate. In
November the Iranian Supreme Court was dissolved. In January 1953,
the Majlis extended Musaddiq’s powers for another twelve months.
These powers were implemented to reject any proposal emanating from
any quarter for a settlement of the oil dispute.

The Shah
became anxious about the growing power of the Prime
Minister. Politicians, landowners, merchants, and the army became
increasingly concerned about the oil situation and economic problems
which had been created or accentuated by the cessation of oil
exports.

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