From the early 1900s, Britain and Germany competed for access to the Ottoman Empire’s suspected oil reserves in Mesopotamia, particularly around Mosul and Baghdad. Germany’s Deutsche Bank was deeply involved through the Baghdad Railway. In 1912, Calouste Gulbenkian helped establish the Turkish Petroleum Company (TPC), bringing together Deutsche Bank, Royal Dutch Shell and the British-backed National Bank of Turkey. In 1914, Anglo-Persian Oil entered the company and took a 50% interest.
During the First World War, Britain occupied Baghdad in 1917 and Mosul in November 1918. Germany’s defeat eliminated its position in TPC. Under the 1920 San Remo agreement, the former German 25% interest was allocated to French interests. The United States, initially excluded from the arrangement, demanded access for American oil companies. The Ottoman Empire lost its Arab territories after the war and formally ceased to exist in 1922.
Turkish Petroleum Company
TPC became the main corporate vehicle for exploiting the oil of former Ottoman Mesopotamia. After the war, British, French and Dutch interests dominated the company until American oil companies secured participation under the 1928 Red Line Agreement. TPC was renamed the Iraq Petroleum Company in 1929 and became one of the dominant forces in Iraqi oil development.
After the Ottoman Empire
A century later, some of the most important oil-producing regions in the world lie within former Ottoman territories.
The largest concentration is in modern Iraq. The former Ottoman provinces of Mosul, Baghdad and Basra contain enormous petroleum resources. Iraq today holds around 145 billion barrels of proved crude reserves and is OPEC’s second-largest crude producer after Saudi Arabia.
Kuwait, historically linked to the Ottoman province of Basra but increasingly under British protection before the First World War, became another petroleum giant, with around 102 billion barrels of proved crude reserves.
The Ottoman connection also extends into today’s Saudi Arabia. The empire controlled Al-Hasa in eastern Arabia until Ibn Saud captured it in 1913. In 1933, Saudi Arabia granted an oil concession to the American Standard Oil Company of California. Commercial quantities of oil were discovered at Dammam in 1938, and eastern Saudi Arabia subsequently became the centre of the kingdom’s petroleum industry.
Syria developed smaller oil fields, while the Republic of Turkey inherited comparatively modest petroleum resources.
The Ottoman Empire disappeared, but the oil beneath many of its former territories went on to shape Iraq, Kuwait, Saudi Arabia and the global energy system.
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