Discovery of petroleum

The discovery of oil in 1932 by Bahrain Petroleum Company[45] brought rapid modernisation to Bahrain. Relations with the United Kingdom became closer, as evidenced by the British Royal Navy moving its entire Middle Eastern command from Bushehr in Iran to Bahrain in 1935.[46] British influence continued to grow as the country developed, culminating with the appointment of Charles Belgrave as advisor.[44] He went on to establish a modern education system in Bahrain.[44] After World War II, increasing anti-British sentiment spread throughout the Arab World and led to riots in Bahrain. The riots focused on the Jewish community, which included distinguished writers, singers, accountants, engineers and middle managers working for the oil company, textile merchants with business all over the peninsula, and free professionals.

In 1948, following rising hostilities and looting,[47] most members of Bahrain's Jewish community abandoned their properties and evacuated to Bombay, later settling in Israel (Pardes Hanna-Karkur) and the United Kingdom. As of 2008, 37 Jews remained in the country.[47] The issue of compensation was never settled. In 1960, the United Kingdom put forward Bahrain's future for international arbitration and requested that the United Nations Secretary-General take on this responsibility.