Iraq Nationalizes Exxon and Mobil Shares in 1973

The Bold Move: Iraq Nationalizes Exxon and Mobil

Iraqi Government's Decision

In a landmark event in oil industry history, the Iraqi government nationalized a significant portion of the Basrah Petroleum Company in 1973. This strategic decision entailed seizing the shares held by major oil companies such as Exxon and Mobil, amounting to 23.75 percent equity in the company, shaking up the global oil market and altering the balance of power in favor of the national government.

Background to the Nationalization

The nationalization was the culmination of growing tensions over oil control in the Middle East. With oil being the lifeblood of modern economies, this move symbolized Iraq's push for greater sovereignty over its natural resources and an end to foreign dominance in its deep-seated oil wealth.

Immediate Effects of the Nationalization

Impact on Exxon and Mobil

The nationalization had profound implications for Exxon and Mobil, two of the largest oil companies at the time. They were forced to adjust their operations and reassess their investments in Iraq, leading to a reevaluation of their strategies in the Middle East, where nationalization movements were gaining momentum.

The Global Oil Market Reaction

The decision sent shockwaves through the global oil market. It highlighted the increasing willingness of national governments to assert control over local resources, a trend that would continue throughout the decade. As other countries considered similar moves, it initiated a series of negotiations and adjustments among oil giants concerning their foreign holdings.

Fun Fact

A Little Known Fact About the Nationalization

Despite the nationalization, which was seen as a politically risky endeavor, Iraq's control over its oil resources eventually led to increased revenues which the government used to fund various development projects. This was a pivotal shift that many other nations looked upon with intrigue.

Additional Resources

Recommended Reading on Iraq's Oil Nationalization

For those interested in learning more, consider reading "The Prize: The Epic Quest for Oil, Money, and Power" by Daniel Yergin, which provides extensive insights into the global oil industry and its historical developments, including nationalization movements.