US-Backed Coup Ousted Iranian PM in 1953 Oil Dispute

In August 1941, Great Britain and the Soviet Union invaded Iran, deposing Shah Reza Khan. His son, Mohammad Reza Pahlavi, succeeded him as shah but had a shaky control over the country.

Nationalism soared in Iran after World War II, with Iranians wanting to take back control of their country. Mohammad Mosaddeq became the champion of those aspirations, seeking to reclaim Iran's sovereignty and expand the power of the Majlis, Iran's parliament.

Mosaddeq's main target was the Anglo-Iranian Oil Company (AIOC), which held a monopoly on Iran's oil production. Britain owned a majority position in the company and imposed a lopsided deal that gave Iran 16 percent of the profits, though the actual percentage was likely far lower.

The AIOC refused to negotiate with Mosaddeq, blockading Iranian oil exports and persuading other Western powers to stay on the sidelines. This led to a devastating impact on Iran's economy, prompting Mosaddeq to break diplomatic relations with Britain and expel all British diplomats in October 1952.

The 1952 U.S. presidential election gave London another opportunity to win U.S. support for ousting Mosaddeq. President Dwight D. Eisenhower pledged not just to 'contain' but 'roll back' communism, and his secretary of state, John Foster Dulles, was convinced that Mosaddeq's nationalization campaign was creating an opening for Communists to seize power.

Eisenhower initially opposed the idea of a coup, telling his British counterpart in March 1953 that Mosaddeq was 'the only hope for the West in Iran.' However, as Mosaddeq rejected compromise proposals and Iranians took to the streets to protest economic hardship, Eisenhower's opposition faded.

The CIA's Operation Ajax aimed to topple Mosaddeq by inflaming Iranian anger at him through paid demonstrations and bribing politicians. The plan hinged on the shah firing Mosaddeq, but when the moment came, the shah balked, fearing his own ouster.