At the Shah of Persia, dynamic, self-made Reza Pahlevi, onetime Cossack trooper, Britain last year hurled an oily ultimatum.
The British Government are controlling shareholders of Anglo-Persian Oil Co. Ltd., which had a concession to exploit Persia's oil fields. Dissatisfied with the royalties Persia was getting, her Shah canceled the concession (TIME, Dec. 12). The British ultimatum gave the Shah until Dec. 15 to reinstate it.
'"Does this mean," cried white-haired British Labor Party Leader George Lansbury in the House of Commons, ''that if certain contingencies arise the British Government proposes to take armed measures?"
''I decline to answer!" snapped the British Government's spokesman, but tough Reza Shah Pahlevi's morale was not shaken. He ignored Britain's ultimatum, let Dec. 15 pass, sent his Minister of Justice speeding to Geneva where, most fortunately, the League Council told off famed Dr. Eduard Benes, perennial Foreign Minister of Czechoslovakia and "Europe's Smartest Little Statesman," to try to calm the Persians and the British.
This job Dr. Benes handsomely completed last week by announcing an agreement secretly arrived at. With no more talk of ultimatums Britain agrees that Anglo-Persian's concession has been canceled. Reza Shah Pahlevi agrees that Anglo-Persian shall continue to work the oil fields while negotiating a new concession. Progress and perhaps the signing of this concession will be reported back to the League next May.
Scapegoat of the Benes agreement, according to news from Teheran, is Abdol Hussein Khan Teymourtache whom the Shah has dismissed from office as his Chief Marshal of the Court and Minister of State. Twenty-two years ago, long before Reza Shah Pahlevi usurped the throne, young Abdol Teymourtache, a clerk in the Persian Finance Ministry, was picked for advancement by the then U. S. Fiscal Adviser to Persia, W. Morgan Schuster. Young Abdol rose steadily to No. 1 court rank.
When Anglo-Persian, due to world overproduction of oil, started to curtail its Persian flow (and therefore the Shah's royalties) Chief Marshal of the Court and Minister of State Teymourtache simply could not understand. "O King of Kings," he reputedly said to the Shah, "the policy of the English is clearly wrong. If more oil is produced, the price of this fluid all over the world will become cheaper, thus conferring universal benefit, and the more oil that flows the greater will be Persia's royalties. Since the deluded English wish to produce less oil, not more, I beg Your Majesty to cancel their concession and order your subjects to operate the wells, thus reducing unemployment among them."
According to English correspondents in Teheran last week, the King of Kings has now come to realize how false and superficial was the reasoning of Teymourtache. Agents of Anglo-Persian may or may not have helped to bring His Majesty around to acceptance of Dr. Benes' formula by the usual implement of Persian persuasion, bagfuls of bright gold.