The 1953 Iranian Coup: How Western Powers Toppled Democracy for Oil

How A Bankrupt Britain Seized Iran's Wealth: - YouTube

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BLUF (Bottom Line Up Front)

The 1953 CIA-MI6 coup against Iranian Prime Minister Mohammad Mossadegh was orchestrated primarily over British oil interests following Iran's nationalization of the Anglo-Iranian Oil Company. While many core facts in the video transcript are accurate—including the coup's execution, Kermit Roosevelt's role, and its long-term consequences—several claims require clarification: specific profit figures vary across sources, the BBC's coded midnight signal remains disputed, and the characterization of some operational details contains dramatic embellishments. The coup definitively undermined Iranian democracy, established a template for future covert operations, and contributed directly to the 1979 Islamic Revolution that severed U.S.-Iranian relations for decades.

When Britain Manipulated America Into Overthrowing Iranian Democracy: The 1953 Coup That Still Haunts Us

How Churchill convinced Eisenhower to destroy a secular democracy, launch decades of covert operations, and inadvertently create the Islamic Republic

WASHINGTON— In August 2013, the Central Intelligence Agency finally acknowledged what Iranians had known for six decades: America overthrew their democratically elected government in 1953. The admission came with release of roughly 1,000 declassified pages detailing Operation Ajax—a coup that seemed brilliantly successful at the time but triggered catastrophic consequences still unfolding today.

"The military coup that overthrew Mosaddeq and his National Front cabinet was carried out under CIA direction as an act of US foreign policy," stated the agency's internal history, ending decades of official denial about an operation that would establish the template for Cold War interventions from Guatemala to Vietnam.

But declassified documents reveal something American audiences rarely grasp: the United States didn't conceive this operation. Britain did. And the story of how a bankrupt empire manipulated its wealthy ally into protecting British oil monopolies illuminates a pattern that would define—and ultimately undermine—American foreign policy for generations.

The Oil That Britain Couldn't Keep

The crisis began March 15, 1951, when Iran's parliament unanimously voted to nationalize the Anglo-Iranian Oil Company (AIOC)—predecessor to modern BP—and its crown jewel, the Abadan refinery. At the time, Abadan was the world's largest oil refinery, producing over 550,000 barrels daily and accounting for roughly 7% of the free world's crude supply.

The economic injustice fueling Iranian anger was stark and mathematical. In 1947, AIOC reported after-tax profits of £40 million ($112 million) while paying Iran only £7 million in royalties. The British government collected more in taxes from AIOC than Iran received for its own natural resources.

Iranian oil workers earned 50 cents daily with no vacation pay, sick leave, or disability compensation. They lived in shanty towns without running water or electricity while British administrators enjoyed segregated compounds with cricket pitches, air conditioning, and food imported from London.

Prime Minister Mohammad Mossadegh—a secular nationalist educated in Switzerland—proposed 50-50 profit sharing similar to arrangements American companies had with Saudi Arabia. Britain refused. London wanted its colonial-era extraction terms or nothing.

Truman Says No, Eisenhower Says Yes

President Harry Truman's administration opposed British demands for a coup. Secretary of State Dean Acheson and Ambassador Henry Grady recognized Iranian grievances as legitimate. Truman's Midwestern populist instincts and New Deal skepticism of corporate monopolies shaped his view: Why should American boys die to preserve British Petroleum's profits?

State Department officials saw Mossadegh not as a communist threat but as a controllable nationalist who could serve as a bulwark against Soviet influence. Even Walter Bedell Smith, who served in both administrations, acknowledged on August 17, 1953: "Whatever his faults, Mosaddegh had no love for the Russians and timely aid might enable him to keep Communism in check."

Britain imposed a comprehensive blockade, froze Iranian assets, and organized an international boycott. The Royal Navy patrolled the Persian Gulf threatening legal action against any company purchasing Iranian crude. Yet Truman held firm throughout 1951-52, repeatedly refusing British entreaties.

Everything changed with Dwight Eisenhower's election in November 1952.

How Churchill Captured Eisenhower

Eisenhower brought fundamentally different formation to the presidency. As Supreme Allied Commander in Europe (1943-45) and NATO's first Supreme Commander (1951-52), he had spent crucial years embedded in European military and political circles. He worked intimately with Winston Churchill and British military leadership—relationships that shaped his worldview.

Eisenhower's strategic priority was NATO cohesion above all else, which meant accommodating European colonial interests even when they conflicted with American ideals. His appointments of John Foster Dulles as Secretary of State and Allen Dulles as CIA Director—both partners at Sullivan & Cromwell, the Wall Street firm that had represented Anglo-Iranian Oil Company—signaled the shift.

British intelligence officials who had failed with Truman approached the incoming Eisenhower transition team in late 1952 with identical arguments, but reframed the narrative. This wasn't about oil monopolies anymore—it was about preventing Iran from falling to communism. MI6 fabricated or exaggerated evidence of the communist Tudeh Party's strength, overstated Soviet designs on Iranian oil, and invoked the specter of "losing Iran."

Churchill personally lobbied his old wartime comrade, playing on their shared history and Eisenhower's instinctive trust in British intelligence. By April 1953—just three months into his presidency—Eisenhower authorized Operation Ajax with an initial $1 million budget.

What changed? Not the facts on the ground in Iran, but the worldview of the American president receiving the intelligence.

The BBC's Role in Propaganda

Documents reveal the BBC Persian service functioned as a propaganda arm during the crisis. In a 2011 documentary, the BBC acknowledged "the British government used the BBC Persian radio for advancing its propaganda against Mosaddegh," with anti-Mossadegh content aired so frequently that Iranian BBC staff went on strike.

A July 21, 1951 classified Foreign Office document thanked the British ambassador for proposals "precisely followed by the BBC Persian radio to strengthen its propaganda against Mosaddegh."

Historical accounts describe the BBC broadcasting a coded signal—changing the usual announcement "It is now midnight in London" to "It is now exactly midnight"—to signal the Shah that Britain supported the coup. While widely reported by historians, this specific detail remains based on secondary sources rather than released BBC archival records.

Operation Ajax: $1 Million Buys a Government

The operation's field commander was Kermit Roosevelt Jr., grandson of Theodore Roosevelt. He entered Iran in summer 1953 with roughly $1 million in cash to fund street protests, bribe officials, and organize demonstrations.

CIA documents detail a sophisticated destabilization campaign: operatives planted anti-Mossadegh stories in newspapers, bribed editors (one received approximately $45,000), recruited gang leaders from traditional wrestling houses, and organized competing mobs to create chaos. CIA agents even bombed at least one prominent Muslim leader's house while posing as communists to inflame religious opposition.

The first attempt on August 15, 1953 failed spectacularly. Colonel Nematollah Nassiri, tasked with arresting Mossadegh, was himself arrested. The Shah fled to Baghdad, then Rome, convinced his reign had ended. CIA headquarters cabled Roosevelt: "Operation has been tried and failed and we should not participate in any operation against Mossadegh which could be traced back to US. Operations against Mossadegh should be discontinued."

Roosevelt famously ignored the order. "At least one guy was in the room with Kermit Roosevelt when he got this cable," recalled Malcolm Byrne, director of the National Security Archive's U.S.-Iran Relations Project. "He said no—we're not done here."

Roosevelt organized a second wave on August 19, flooding Tehran with CIA-funded protesters. Pro-Shah military units joined the movement. General Fazlollah Zahedi, hiding in a CIA safe house, emerged atop a tank. After fierce fighting that killed 200-300 people, Mossadegh's residence was stormed. He surrendered, received three years in prison, then lived under house arrest until his death in 1967.

Britain's Pyrrhic Victory

The coup's aftermath delivered Britain a bitter surprise. Rather than restoring AIOC's monopoly, the 1954 Consortium Agreement forced Britain to share Iranian oil with American companies: 40% to British Petroleum, 40% collectively to five U.S. oil companies, 14% to Royal Dutch/Shell, and 6% to Compagnie Française des Pétroles.

Britain received £214 million ($600 million) from consortium partners as compensation for surrendering 60% of its former holdings, plus £25 million from Iran. While British officials publicly celebrated, the agreement marked the definitive end of British supremacy in Middle Eastern oil.

The Americans had done Britain's dirty work—and claimed most of the spoils.

The 26-Year Reckoning

The coup's immediate financial success—$1 million investment yielding decades of oil profits—masked catastrophic long-term consequences. By crushing democratic nationalism, Western powers eliminated the political center in Iran, leaving only two paths: the Shah's increasingly brutal autocracy or religious opposition.

Shah Mohammad Reza Pahlavi, restored by foreign intervention, became increasingly dictatorial. His secret police, SAVAK, established with CIA and Israeli Mossad assistance, became notorious for torture and repression. For 26 years the Shah ruled with Western backing until the 1979 Islamic Revolution swept him from power.

"The 1979 revolution was a long-term effect of the increasing repression from the shah, who came to power as a result of the coup," observed author Stephen Kinzer.

When revolutionaries stormed the U.S. Embassy in November 1979 and held 52 Americans hostage for 444 days, they explicitly cited the 1953 coup as justification. The loss of Iran created an adversarial relationship persisting today, contributing to the Iran-Iraq War, the rise of Hezbollah, and ongoing nuclear tensions.

The Pattern Repeats: From Iran to Cuba

Eisenhower's faith in covert operations, validated by Iran's apparent success, established a template applied repeatedly. In Guatemala (1954), the CIA overthrew democratically elected President Jacobo Árbenz to protect United Fruit Company holdings. In Congo (1960-61), the CIA targeted Patrice Lumumba. In Vietnam, Eisenhower inherited France's colonial war and escalated American involvement.

The pattern was consistent: accepting European framing of nationalist movements, viewing them exclusively through an anti-communist lens, and deploying American covert action to preserve post-colonial arrangements favorable to Western interests.

Eisenhower's presidency was bookended by operations rooted in the same colonial mentality. At the beginning: Iran's coup creating decades of blowback. At the end: the Bay of Pigs operation, planned in 1960 and bequeathed to Kennedy.

Allen Dulles, architect of Iran and Guatemala's coups, assumed the same CIA playbook would work in Cuba. It didn't. The April 1961 Bay of Pigs disaster convinced Soviet Premier Nikita Khrushchev that Kennedy was weak—emboldening him to place nuclear missiles in Cuba 18 months later. The October 1962 Cuban Missile Crisis brought humanity closer to nuclear annihilation than any moment in history.

Both disasters—Iran at the beginning, Cuba at the end—stemmed from Eisenhower's European-oriented worldview and Allen Dulles's supreme arrogance.

The Road Not Taken

What if Truman's approach had continued? Imagine if the United States in 1953 had pressured Britain to accept Mossadegh's 50-50 profit-sharing proposal, provided economic aid to stabilize Iran's economy, and supported Iranian democracy as a model for the region.

Iran might have developed as a secular democracy with normal commercial relations with the West. The 1979 Islamic Revolution—rooted in rage over the 1953 coup and 26 years of dictatorship—might never have occurred. The United States would have positioned itself as the anti-colonial superpower, building genuine partnerships rather than inheriting European enemies.

Truman was strategically correct. His approach would have avoided Vietnam's catastrophe (58,000 American dead), decades of Middle Eastern instability, and anti-American terrorism rooted in rage over Western intervention.

Instead, Eisenhower's choice to serve as Europe's "cat's paw"—protecting British oil monopolies and French colonial holdings—committed America to intervention that undermined the democratic values it claimed to defend.

Belated Acknowledgments, Persistent Consequences

In March 2000, Secretary of State Madeleine Albright came closest to an official apology: "In 1953, the United States played a significant role in orchestrating the overthrow of Iran's popular prime minister, Mohammed Mosaddegh."

President Obama's 2009 Cairo speech acknowledged: "In the middle of the Cold War, the United States played a role in the overthrow of a democratically elected Iranian government."

The CIA's 2013 admission and State Department's 2017 document releases brought transparency, though some records were destroyed long ago.

When the Wells Run Dry: History's Unexpected Opening

Seventy years after the coup, history may be offering an ironic opportunity for redemption. The Islamic Republic now faces an existential threat that no ideology can combat, no sanctions can worsen, and no military force can inflict: the complete collapse of its water supply.

Tehran's main reservoirs stand at just 11% capacity as of December 2024. Nineteen major dams approach total depletion. Iran extracts 63.8 billion cubic meters of groundwater annually while natural replenishment provides only 50 billion. Rainfall has dropped 45% below normal for the 2024-25 water year. President Masoud Pezeshkian has warned Iran may have "no choice" but to evacuate Tehran's 15 million residents.

This isn't just climate change—it's decades of corruption and mismanagement by the Islamic Revolutionary Guard Corps, which operates what critics call a "water mafia," profiteering from dam construction and illegal wells while ordinary Iranians suffer. The regime subsidizes water at 52% of actual cost, encouraging waste, while one-third of Tehran's water disappears through leaks and theft.

The water crisis creates what experts call "water bankruptcy"—a systemic collapse requiring fundamental reforms the regime cannot implement without dismantling its own power base. Each necessary reform threatens core regime interests: ending subsidies, stopping proxy wars that drain resources, accepting foreign investment, allowing transparency.

Trump's Nixon-to-China Moment?

Enter Donald Trump's second term and his explicit ambition to be remembered as "the president of peace." His Middle East track record shows a pattern: the Abraham Accords (2020), the Gaza ceasefire and hostage release (October 2025), lifting Syria sanctions and meeting with new Syrian leadership. Trump has stated clearly: "I would prefer that to bombing the hell out of it" when asked about negotiating a nuclear deal with Iran.

Several strategic factors now align that have never existed simultaneously before:

Iran's Weakness: Environmental catastrophe threatening regime survival, decimated nuclear program after June 2025 strikes, weakened regional proxies, 78% of Iranians blaming foreign policy for economic problems, record-low youth engagement.

Trump's Motivation: Second-term presidents historically pursue bold diplomacy unburdened by reelection concerns. Trump explicitly seeks legacy as a historic peacemaker—a comprehensive Iran deal would surpass even the Abraham Accords.

Regional Readiness: Saudi Arabia, UAE, and other Gulf states willing to accommodate peace. Even Israel's security establishment increasingly recognizes that military force alone cannot permanently solve the Iran challenge.

Economic Incentives: Nearly $1 trillion in potential economic opportunities. Trump's transactional approach and emphasis on "deals" align with comprehensive negotiation.

Historical Precedent: Richard Nixon's 1972 opening to China fundamentally altered the global order. Only a president with impeccable anti-communist credentials could have made that move. Similarly, only Trump—who withdrew from the Iran nuclear deal and ordered strikes on Iran's nuclear program—has the political capital to pursue comprehensive normalization.

What a Grand Bargain Could Look Like

A comprehensive settlement might include:

Nuclear Resolution: Verifiable dismantlement of weapons-capable facilities, international monitoring, but peaceful nuclear energy allowed under strict safeguards.

Regional Stability: Non-aggression pact between Iran and Israel, reduced support for proxy forces, de-escalation across Yemen, Lebanon, Syria, and Iraq.

Economic Normalization: Lifting of U.S. sanctions, access to international banking and oil markets, massive infrastructure investment including water crisis remediation, technology transfers for environmental restoration.

Phased Integration: Eventual incorporation into expanded Abraham Accords framework, positioning Iran as a bridge between the Gulf states and the broader Middle East.

The tragic irony would be profound: A president who began his first term by withdrawing from the Iran nuclear deal could end his presidency by negotiating the comprehensive settlement that eluded every president since 1979.

Breaking the 72-Year Cycle

Mossadegh wanted to sell oil to the West—he just wanted fair terms. Britain's intransigence and the subsequent coup didn't "save" Iranian oil for the West. It eventually lost it entirely in 1979, replaced a potential ally with a hostile theocracy, and destabilized an entire region for three generations.

If Britain had simply accepted the 50-50 deal in 1951, or if Truman's sympathetic approach had prevailed, none of the subsequent catastrophes—SAVAK's torture chambers, the 1979 revolution, the hostage crisis, the Iran-Iraq War, decades of sanctions, the nuclear standoff—would have occurred.

Trump now faces a unique historical moment where environmental catastrophe gives Iran genuine incentive to negotiate from weakness, regional powers are willing to accommodate peace, and American voters are exhausted by Middle East conflicts. The wells are running dry. The old certainties are evaporating. The regime's own people are desperate for change.

The question is whether Trump—the self-proclaimed deal-maker who has already demonstrated willingness to pursue unexpected diplomatic openings—will seize this moment or whether fear of domestic criticism will lead him to choose continued confrontation.

History offers a clear lesson from 1953: short-term tactical thinking that ignores legitimate grievances and crushes secular democratic nationalism produces catastrophic long-term strategic consequences. The choice then between Truman's pragmatic anti-colonialism and Eisenhower's European-oriented interventionism still reverberates today.

Now history offers a chance to choose differently. Trump could position himself as the president who finally closed the book on 1953, transformed America's most enduring Middle Eastern adversary into a partner, and demonstrated that even the deepest historical wounds can heal when interests align and leadership has courage.

That would be a legacy worth leaving—and a fitting end to a 72-year cycle of mutual grievance and missed opportunities.

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Sources

U.S. Government Documents

• CIA, "Campaign to Install Pro-Western Government in Iran" (declassified 2013), National Security Archive, George Washington University: https://nsarchive2.gwu.edu/NSAEBB/NSAEBB435/
• U.S. State Department, Office of the Historian, Foreign Relations of the United States, 1952-1954, Iran, Volume X (2017): https://history.state.gov/historicaldocuments/frus1951-54Iran
• National Security Archive, "CIA Confirms Role in 1953 Iran Coup": https://nsarchive.gwu.edu/briefing-book/iran/2013-08-19/cia-confirms-role-1953-iran-coup

Official Government Statements

• Obama, Barack, "Remarks by the President on a New Beginning," Cairo University, June 4, 2009
• Albright, Madeleine, Speech before American Iranian Council, March 17, 2000

Academic Sources

• Gasiorowski, Mark J. and Malcolm Byrne (eds), Mohammad Mosaddeq and the 1953 Coup in Iran, Syracuse University Press, 2004
• Kinzer, Stephen, All the Shah's Men: An American Coup and the Roots of Middle East Terror, John Wiley & Sons, 2003
• Abrahamian, Ervand, The Coup: 1953, the CIA, and the Roots of Modern U.S.-Iranian Relations, The New Press, 2013

BBC Documentation

• BBC Persian "Cinematograph" documentary, August 18, 2011
• Curtis, Mark, Web of Deceit: Britain's Real Role in the World, Vintage, 2003
• UK Foreign Office documents (declassified), July 21, 1951

Contemporary Reporting

• Foreign Policy, "64 Years Later, CIA Finally Releases Details of Iranian Coup," June 20, 2017: https://foreignpolicy.com/2017/06/20/64-years-later-cia-finally-releases-details-of-iranian-coup/
• Al Jazeera, "CIA Admits Organizing 1953 Iran Coup," August 20, 2013: https://www.aljazeera.com/news/2013/8/20/cia-admits-organising-1953-iran-coup
• NPR, "Coup 53 Tells The True Story Of The CIA's Campaign To Oust Iran's Leader," August 18, 2020: https://www.npr.org/2020/08/18/903505983/coup-53-tells-the-true-story-of-the-cia-s-campaign-to-oust-iran-s-leader

Oil Industry & Economic Documentation

• Encyclopaedia Iranica, "Consortium Agreement of 1954": https://www.iranicaonline.org/articles/oil-agreements-in-iran
• Anglo-Iranian Oil Company records, BP Archive
• UK House of Commons Debates, "Persian Oil Agreement," November 1, 1954

Iran Water Crisis & Current Situation

• Center for Strategic and International Studies (CSIS), "Satellite Imagery Shows Tehran's Accelerating Water Crisis," December 2024
• CNN, "Taps may run dry in this country, where the water crisis is so severe it can be seen from space," December 2025
• Carnegie Endowment for International Peace, "Iran's Water Crisis Is a Warning to Other Countries," November 2025
• Middle East Institute, "New polling highlights Iranians' views on Iran's foreign policy and regional role," October 2024
• National Council of Resistance of Iran, "Why Iran Is Running Out of Water, Power—and Patience," November 2024
• Foreign Affairs, "Trump's Middle East Order," 2025
• The Washington Institute, "The Emerging Trump Doctrine in the Middle East," 2025

Reference Works

• Britannica, "1953 Iranian Coup d'État": https://www.britannica.com/event/1953-coup-in-Iran
• Lapham's Quarterly, "Operation Ajax: The 1953 Iranian Coup": https://www.laphamsquarterly.org/roundtable/operation-ajax

Documentary Films

• Amirani, Taghi and Walter Murch (dirs), Coup 53, 2019

 

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