Iran Before the Islamic Revolution

Iran, with its rich history, diverse cultures, and breathtaking landscapes, stands prominently in the global spotlight. What sets Iran apart is not just its cultural tapestry but also its significant role in the world's energy landscape. Endowed with abundant reserves of oil and natural gas, Iran's economic growth, nuclear program, and international relationships are deeply intertwined with these valuable resources and Iran’s geographical position.

The history of Iranian oil began in the early 20th century when British entrepreneur William Knox D'Arcy secured a concession from the Qajar dynasty in 1908. This granted him exclusive rights to explore and extract oil in Iran. The discovery of oil in southwest Iran led to the formation of the Anglo-Persian Oil Company, marking the start of the Iranian oil industry. By the 1920s, oil contributed to almost half of the country's revenues.

In the early 20th century, foreign oil companies, notably the Anglo-Persian Oil Company, dominated Iran's oil industry. The exploitative relationship led to discontent as the majority of profits went to the British, leaving Iranians with meager royalties. In 1951, Prime Minister Mohammad Mossadegh championed the cause of reclaiming Iran's sovereignty over its oil, leading to the nationalization of the industry. This move faced fierce opposition from the British, resulting in an oil embargo and economic difficulties. In 1953, the U.S. and the UK orchestrated a coup to overthrow Mossadegh. The global powers reinstated Mohammad Reza Shah Pahlavi to ensure a government favorable to Western interests, particularly in oil. The Shah reversed nationalization policies and reopened Iran to foreign oil companies.

Shortly after, the U.S. encouraged American oil companies to invest in Iran. But that was just one piece of a grand plan to uplift Iran and keep it out of the Soviet Union's grasp. Concentrated efforts went into social development projects.

Shah Pahlavi’s government implemented a series of economic reforms, in an effort to modernize and industrialize Iran, and reduce its dependence on oil revenues. The United States systematically aided Iran's economy, providing financial assistance to spur economic development, stabilize the political landscape, and support military and technical self-defense. Industrial growth, guided by the U.S., diversified Iran's production, and exports. The U.S. extended grants and loans for a major dam project on the Karaj River and invested in infrastructure projects, including a 1,500-mile highway system, railway system and national airline.

Under the Shah's rule, Iran underwent significant social transformations. Women gained rights such as voting, working outside the home, divorce and child custody. Educational opportunities for women also expanded during this period. Overall, the Shah introduced legal reforms that granted women more rights.

Simultaneously, the Imperial Iranian Armed Forces, supplied by the U.S., became one of the strongest in the Middle East. The Imperial Iranian Armed Forces was sometimes ranked as the 5th strongest military in the world. During the 1970s, the United States supplied Iran with a wide range of advanced weaponry, including F-14 fighter jets.

In 1974, as part of “Atoms for Peace” program, an initial agreement was reached between the United States and Iran. The U.S. committed to selling two nuclear reactors and enriched uranium to Iran. The collaboration deepened in 1975 with a monumental 15-billion-dollar trade deal between the United States and Iran. This comprehensive agreement included provisions for Iran to purchase eight reactors from the United States.

In the 70’s the predictions confidently declared Iran on track to become "the most prosperous country in Asia after Japan" and comparable to many European nations.  But was everything in Iran as great as it was portrayed?  Despite abundant natural resources, economic hardships loomed large. Inflation and unemployment rates soared, leaving ordinary Iranians struggling to make ends meet. While the Shah's circle continued to amass wealth, economic inequality became a glaring issue, leading to growing frustration among the population.

The Shah's regime also faced criticism for violating human rights, employing secret police, as well as for censorship and imprisonment of opposition. Shah's authoritarian rule and suppression of political dissent created a climate of fear and resentment among the Iranian populace.

By the late 1970s, Tehran's atmosphere turned toxic. Plummeting oil prices, combined with a rising cost of living, fueled public anger. Ayatollah Khomeini capitalized on growing dissent and called for the Shah's removal.

And so began the Iranian Revolution of 1979. The revolution marked a seismic shift and forever changed Iran’s fate, its economy, and its role in geopolitics. The revolution reshaped the country’s trajectory and introduced a new chapter in the complex narrative of Iran.

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