Suez Crisis Overview

The Suez Crisis

The Suez Crisis of 1956, in which the Egyptian Government seized control of the Suez Canal from the British and French owned company that managed it, had important consequences for U.S. relations with both Middle Eastern countries and European allies. On July 26, 1956, Egyptian President Gamal Abdel Nasser nationalized the British and French owned Suez Canal Company that operated the Suez Canal. Nasser's decision threatened British and French stock holdings in the Company and, as the Canal afforded Western countries access to Middle Eastern oil, also threatened to cut off Europe's oil supply. The ensuing Suez Crisis threatened regional stability and challenged the U.S. relationship with two primary Cold War allies, Britain and France.

Nasser nationalized the canal after the United States and Britain reneged on a previous agreement to finance the Aswan Dam project. The Aswan Dam was designed to control the Nile's flood waters and provide electricity and water to the Egyptian populace and, as such, was a symbol of Egypt's modernization. The United States and Britain withdrew their financing for the Aswan Dam after Nasser made several moves that appeared friendly to the communist bloc, including an arms deal with Czechoslovakia and recognition of the Chinese Government in Beijing. Without support from the United States and Britain, Nasser needed the revenue generated from tolls collected from ships using the Suez Canal to subsidize the cost of building the dam.

Although the United State was concerned about Nasser's nationalization of the canal, it sought a diplomatic solution to the problem. Britain and France, however, viewed the situation as a threat to their national interests. Accordingly, they sought a military solution that involved Israel. They secretly contacted the Israeli Government and proposed a joint military operation in which Israel would invade the Sinai and march toward the Suez Canal zone after which Britain and France would issue a warning to both Egypt and Israel to stay away from the Canal. Britain and France would then land paratroopers in the Canal Zone on the pretense of protecting it. Israel willingly agreed to this scenario since it gave Israel the opportunity to gain control of the Gaza Strip and Sinai Peninsula, end the Egyptian blockade of the Straits of Tiran, and retaliate against Egypt over its support for Palestinian commando raids on Israel's western border during the previous two years.

The Suez conflict fundamentally altered the regional balance of power. It was a military defeat for Egypt, but Nasser's status grew in the Arab world as the defender of Arab nationalism. Israel withdrew from Egyptian territory gained in the fighting but regained access to the Straits of Tiran, while the United Nations adopted a larger role maintaining a peacekeeping force in the Sinai. Britain and France lost influence in the region and suffered humiliation after the withdrawal of their troops from the Canal Zone. Moreover, relations between the United States and its British and French allies temporarily deteriorated in the months following the war. In contrast, Soviet influence in the Middle East grew, especially in Syria where the Soviets began to supply arms and advisers to the Syrian military. The United States had played a moderating role, and in so doing had improved its relations with Egypt, but the fundamental disputes between Israel and its neighbors remained unresolved. When these disagreements resurfaced, the United States would again be drawn into the conflicts.  

On October 29, 1956, Israeli forces moved across the border, defeated the Egyptian army in the Sinai, captured Sharm al-Sheikh and thereby guaranteed Israeli strategic control over the Straits of Tiran. Britain and France issued their ultimatum and landed troops, effectively carrying out the agreed upon operation. However, the United States and the Soviet Union responded to events by demanding a cease-fire. In a resolution before the United Nations, the United States also called for the evacuation of Israeli, French, and British forces from Egypt under the supervision of a special United Nations force. This force arrived in Egypt in mid-November. By December 22, the last British and French troops had withdrawn from Egyptian territory, but Israel kept its troops in Gaza until March 19, 1957, when the United States finally compelled the Israeli Government to withdraw its troops.

 Source: http://2001-2009.state.gov/r/pa/ho/time/lw/97179.htm