Assab to Abadan: The Price of Oil, Sovereignty, and the Road to the Red Sea

by Ezra Musa
Assab to Abadan: The Price of Oil, Sovereignty, and the Road to the Red Sea:

The Cartel’s Iron Fist: From Mossadegh’s Ouster to Mattei’s Fatal Flight.

The mid-20th century was defined by a ruthless struggle for control of global energy resources, a contest where national interest and corporate profit often merged into a single, irresistible force. The stories of Sinclair Oil in Eritrea, Prime Minister Mossadegh in Iran, and Enrico Mattei in Italy demonstrate a fatal principle: to challenge the established Anglo-American oil order was to risk economic ruin, political overthrow, or a mysterious death.

The Lesson for Prosperity Party and the Road to Assab
The history of oil and power in this era holds a crucial lesson for Ethiopia’s Prosperity Party (PP) leadership concerning current aspirations for a Red Sea port like Asseb. The successful campaign for Eritrea’s federation in 1952 illustrates that Ethiopia’s past access to the sea was never an inherent right, but a bargain struck with global powers for corporate and military gain.

The U.S. State Department did not support Emperor Haile Selassie’s claim to Eritrea out of pure diplomatic benevolence; it was directly responding to the demands of Sinclair Oil Corporation for a secure pipeline outlet and the U.S. military’s need for the Kagnew Station communications base. When the primary corporate interest (Sinclair failed to find oil) and the military interest (Kagnew became obsolete) eventually faded, the strategic foundation for the federation crumbled, leading to Eritrea’s eventual independence.
Therefore, for the PP to now claim Assab or Red Sea access as a historical imperative, it ignores the critical lesson: access was transactional, not territorial. Red Sea access was once tied to a specific, self-interested, and temporary Western agenda.

1. The Precedent of Commercial Diplomacy: Sinclair Oil and the Fate of Eritrea
   The saga of Sinclair Oil Corporation securing a vast concession to search for oil in Ethiopia’s Ogaden region in 1945 established a clear precedent for American foreign policy in the post-war world: U.S. strategic interests would be aligned with its corporate oil interests.
   Sinclair’s success in exploiting its concession depended entirely on a stable, secure port for its future oil pipeline. That port had to be in Eritrea, a former Italian colony whose fate was being determined by the victorious powers. In a bold act of lobbying, Sinclair’s president, H. F. Sinclair, wrote directly to then-Secretary of State James F. Byrnes in 1945. His demand was unambiguous: the U.S. must back Ethiopia’s claim to Eritrea, or the entire American investment would be “seriously be delayed and affected.”
   The ultimate result—the 1952 UN resolution federating Eritrea with Ethiopia—provided Emperor Haile Selassie with the port access he desired and secured the necessary stable environment for Sinclair’s operations. Crucially, this arrangement also satisfied the U.S. Cold War military establishment, which obtained its vital Kagnew Station communications base near the Eritrean capital, Asmara.
   The connection here is one of unification by demand: A U.S. corporate commercial need was directly addressed by a U.S. diplomatic action, demonstrating how the State Department was willing to influence territorial boundaries to secure both American business interests and strategic military access.
   • The Price of Independence: Prime Minister Mossadegh and Iranian Oil
     If Sinclair’s story was about a corporation requesting diplomatic aid, the story of Mohammad Mossadegh in Iran was about a nation demanding autonomy—specifically over its oil wealth in Abadan.
     In 1951, as the nationalist movement surged, Prime Minister Mossadegh nationalized the vast holdings of the Anglo-Iranian Oil Company (AIOC). This was a direct, existential challenge to the control of the Seven Sisters—the powerful cartel of Western oil majors. Mossadegh stood for national sovereignty against the neocolonial structure of the oil concession system.
   • 
     The Western response was immediate and punishing. Britain imposed a debilitating global embargo on Iranian oil. The crisis was solved not by diplomacy, but by a joint covert operation. The U.S. Central Intelligence Agency (CIA), under the code name TPAJAX, partnered with Britain’s MI6 to orchestrate a coup d’état in 1953. Mossadegh was overthrown, imprisoned, and the Shah was restored to power.

Following the coup, Iranian oil returned to the market under the control of the Iranian Oil Participants Ltd. (IOP), a consortium structured to diffuse ownership and minimize risk to any single entity. This consortium was indeed largely controlled by Western companies, with the ownership breakdown as follows: British Petroleum (40%), Royal Dutch Shell (14%), and Compagnie Française des Pétroles (6%), with the remaining 40% held by U.S. firms. The five major U.S. firms—Standard Oil of New Jersey (ExxonMobil), Standard Oil of California (SoCal) (Chevron), Texaco (Chevron), Gulf Oil (Chevron), and Socony-Vacuum Oil Company (ExxonMobil)—each took an 8% share, cementing American control over a critical portion of Iranian production.
This is the central connection: Mossadegh’s attempt to use national sovereignty to un-link his nation’s fate from Western oil interests was met with a swift, violent, and highly secretive political intervention. He paid the ultimate political price for challenging the principle that was subtly affirmed in the Eritrea-Sinclair case: oil security for the West superseded the sovereign rights of the host nation.

3. The Uncontrolled Challenger: Enrico Mattei and the Fatal Flight
   The threat to the cartel did not end with Mossadegh. In Italy, Enrico Mattei, the head of the state-owned oil firm AGIP/ENI, launched a unique attack from within the Western alliance.
   Mattei defied orders to liquidate AGIP after World War II. Instead, he built it into an aggressive multinational that directly challenged the Seven Sisters’ model of exploitation. His “Mattei Formula” offered producing nations up to 75% of the profits, a deal that blew up the traditional 50/50 split and gained him allies across the post-colonial world. His dealings with nations like Iran and his controversial oil contracts with the Soviet Union made him an economic and geopolitical threat to both the U.S. and its European allies, particularly France.
   Mattei’s fate mirrored the severity of the threat he posed. On October 27, 1962, his private jet crashed under highly suspicious circumstances near Milan. Later investigations strongly suggested the presence of an explosive device.
   Mattei’s death closes the circle of risk: he was not a nationalist leader in the Third World, but an immensely powerful Western figure who broke the rules of the cartel. His success in offering a better deal for producing countries (like those whose national interests Mossadegh fought for) made him a target. He was a wealthy man with great political connections, but even he could not withstand the lethal force arrayed against those who threatened to dismantle the structure of global oil control.

In all three cases—Eritrea’s political absorption (driven by the strategic need for access via places like Asseb), Iran’s political overthrow (driven by the resource at Abadan), and Mattei’s violent end—the consistent, lethal force was the preservation of a Western-centric energy security regime, often at the expense of national self-determination.