2018 - 2019 Modern Volume 9

Mr Five Per Cent: The Forgotten Oil Tycoon

When we think of modern history’s most notable business leaders, names of Western businessmen such as Henry Ford, John D. Rockefeller and Bill Gates immediately spring to mind. However, arguably one of the most influential and historically overlooked business minds of the twentieth century hailed from the Middle East. Calouste Sarkin Gulbenkian, otherwise known as “Mr. Five Percent”, was both a dedicated philanthropist and a strategic businessman, often credited as the first person to exploit Iraqi oil resources. In fact, by the time of his death in 1955, he had become one of the world’s richest men, accumulating a fortune of almost £5 billion by modern standards.

Of Armenian origin and British nationality, Gulbenkian was a truly international figure, living in a plethora of locations throughout his life, including London, Paris, Istanbul and Lisbon. He played a crucial role in opening up the oil reserves of the Middle East to Western oil companies, despite only visiting an oil field once in his life during his studies at Kings College London. Due to his remarkable negotiation skills he was able to acquire a 5% stake in the corporations he dealt business with, earning him his aforementioned nickname.

In spite of his achievements, Gulbenkian’s legacy has been somewhat marginalised. Indeed, Jonathan Conlin’s Mr Five Per Cent – published this year – is the first full study on the man’s life to be compiled since the 1950s. However, Gulbenkian’s story deserves to be remembered and shared for several reasons.

Gulbenkian’s actions serve as a substantial blow to the unrelenting forces and perpetuating narrative of Western imperialism in the early twentieth century. In the interwar period, the United States, Britain, France and Russia all sought to stake a claim to the untapped oil reserves of the collapsing Ottoman Empire. Gulbenkian was instrumental in drafting the ‘Red Line Agreement’ of 1928, which basically ensured that all Western companies would not operate within the agreed-upon territories other than through the avenue’s he helped outline such as their joint venture, the Turkish Petroleum Company (TPC), which later became the Iraq Petroleum Company (IPC).

The deal simultaneously resolved the dispute between the leading world powers of the time and ensured Gulbenkian his own 5% share of the profits. Although this may sound like a meagre amount, Gulbenkian fought tooth and nail to protect his share, and by the 1950s he had amassed a vast amount of wealth as a result. Therefore, whether he had intended to or not, the Armenian tycoon managed to ensure that considerable financial gains went into his pockets and not those of Western oil corporations.

Gulbenkian was able to give back to his native community through his philanthropic activities. He supported a number of Armenian charities, such as the S. Pirgic hospital in Istanbul, where his parents were buried, as well as leaving the majority of his Armenian art collection to the Armenian Museum in Jerusalem. Gulbenkian also strove to provide economic opportunities for his fellow countrymen. During the Red Line Agreement negotiations, he insisted that 5% of the IPC’s workers in the field be Armenians, and that proceeds from his 5% share of oil profits should go to Armenian families. In addition to this, he became president of the Armenian General Benevolent Union between 1930 and 1932, an organisation which aims to promote and preserve Armenian heritage. Although “Mr. Five Per Cent” was cosmopolitan in his methods, he prioritised the well-being of his homeland above all else. Gulbenkian ultimately diverted profits away from Western oil barons and towards the preservation of his own culture, which had been profoundly shaken by the Armenian Genocide of 1915.

Legacies such as Gulbenkian’s should be addressed in equal measure as an example of today’s aspiring business acumen and leadership. From a chronological stance, his philanthropic work can be interpreted as a precursor to those of more modern and mainstream philanthropists such as Bill Gates and Warren Buffett. However, as is important with all key figures that come to dominate our understanding of relative histories, his life should be looked at with nuance. For instance, Gulbenkian was a known tax avoider and infamous for his uncooperative and unsociable attitude by various people who came into contact with him. Nevertheless he is an extremely interesting figure to learn about and without engaging with, for example, his actions during the Red Line Agreement negotiations, we would arguably have a very Westernised viewpoint of what has come to shape the course of oil exploitation in the Middle East right up to the present day.


Gulbenkian Foundation website – https://gulbenkian.pt/en/the-foundation/calouste-sarkis-gulbenkian/

Financial Times review of Conlin’s book – https://www.ft.com/content/578a045a-1358-11e9-a581-4ff78404524e

Guardian review of Conlin’s book – https://www.theguardian.com/books/2019/jan/03/mr-five-per-cent-calouste-gulbenian-worlds-richest-man

Armenian history website – http://100years100facts.com/facts/calouste-gulbenkian-nicknamed-mr-five-percent/