Book Review - Oil & Development

Rosemarie Said Zahlan. ‘The Impact of the Early Oil Concessions in the Gulf States’, in Richard Lawless (ed.), The Gulf in the Early 20th Century: Foreign Institutions and Local Responses

Zahlan begins by asserting that the economic, political and social effects of early oil concessions in the Gulf states “are well known and need no elaboration”. She chooses to focus upon the “sequence of phases” which transformed the Arabian Peninsula (almost) beyond recognition. Zahlan notes the strategic importance of the Gulf states in facilitating imperial communications between Britain and India, realised in the various “air agreements” signed between local rulers and the British government. She argues convincingly that British negotiations concerning oil concessions were informed by strategic, rather than economic objectives. It’s worth drawing attention to the conflation of public and private interests which guided such negotiations; the fiercely guarded imperial relationship between local ruler and British representative was expanded to include British oil companies. This was in fact the inauspicious beginnings of a sustained (and arguably on-going) period of oil diplomacy, which in the following decades, would come to colour Anglo-American relations.

Where Zahlan’s analysis really stands out, is in its treatment of shaikhly authority; the transformative effect of early oil concessions upon the nature of rulership in the Gulf states. Oil concessions meant a recalibration of the relationship between Gulf rulers and British imperial power; the profit-potential of exclusive oil concessions empowered rulers to negotiate generous economic terms by forcing oil companies to outbid each other. The benefits of oil were not simply commercial, they were also political. Recognising the umbilical link between British commercial and strategic interests, Shaikh Abdallah bin Qasim, the ruler of Qatar, granted an exclusive oil agreement to a British company in exchange for a guarantee of British military protection against possible attack from the Wahhabi-Saudi state. On a domestic level, the huge revenues generated by oil concessions disrupted the relationship between the shaikh and his people. Oil income reduced the ruler’s dependence upon the shaikhdom’s mercantile community and thus limited the political agency of that community within the internal affairs of the shaikhdom. Zahlan states that “the ruler’s income from the agreements was personal to him and not to society at large”; financial independence considerably reduced the ruler’s accountability to the populous. Zahlan cites Bahrain as an example of how the distance between the shaikh and his subjects widened with the advent of administrative reform. The traditional majlis, which promoted dialogue between the ruler and his people, was undermined by the creation of a “modern” system of government, divided into a serious of departments. It is fair to argue that this bureaucratic division of labour has permanently altered the political landscape of the entire Gulf, ceremonialising (and in the process, trivialising) the tradition of direct contact between the ruler and his people.

Zahlan’s argument concerning the effect of early oil concessions upon the delineation of territorial boundaries in the Gulf is of particular interest. She argues that the commercial imperative to distinguish between disparate concessionary zones was diametrically opposed to the tribalism prevalent in the Arabian Peninsula. This resulted in a number of territorial disputes, “amply illustrated in the esoteric patchwork map which makes up the United Arab Emirates (UAE) today”. Zahlan conducts her analysis of the early oil concessions within three distinct frames; the international, the regional, and the local. This method serves to visually clarify her argument and emphasise the wide range of factors which must be considered in order to fully understand the subject. However, it also serves to oversimplify the subject by failing to stress the overlap between international, regional and local forces in the Gulf states. Having acknowledged this shortcoming, it must be said that Zahlan undoubtedly succeeds in conveying the overall effect of early oil concessions, their profound effect upon social, political economic conditions in the oil-producing Gulf states.