The Oil Boom in the Caucasus - Batumi’s Labour Movement Against Oil Magnates and the Russian Imperial Rule

Contributed by Irakli Iremadze

Before 1878, the southwestern part of the Caucasus, populated by Georgians and Armenians, was under the control of Ottoman Empire. Following the Russian-Ottoman war in 1877-1878, this region was occupied by the Russian Empire. As a result, the small Georgian city of Batumi, located on the Black Sea Coast, became a part of Russian Empire.

In the 1870s, major oil industries emerged around Baku, a small city on the Caspian Sea. Alongside local Caucasian businessmen, the prominent innovator of the global oil industry, Robert Nobel, arrived in the region, and the Nobel brothers' oil company (Branobel) rapidly expanded production.

The most efficient route for exporting Baku oil to the international markets involved transporting it via the Caspian Sea to the Black Sea ports, and then shipping it overseas. In 1883, Baku was connected to Tbilisi by railway. Around the same time, it became possible to transport oil by directly from Baku to Batumi by rail. Since then, Batumi has served as a key destination for delivering Baku’s oil to global markets.

The first oil refinery in Batumi was built in 1882, and was soon acquired by the Rothschilds family. In 1884, a German businessman, Reichter, opened a barrel-making factory to support the oil indsutry in Batumi. In 1886, another large factory was opened by Armenian businessman Mantashev. By 1890, the largest oil refineries in Batumi were owned by Rothschilds and Nobels. According to official statistics of 1890, the total value of oil exported from Batumi to international markets exceeded 26.6 million Russian rubles (equivalent to approximately 3 million pounds sterling at the time, or nearly 500 million pounds sterling in today’s currency). In 1890, a total of 3,943 workers were employed in Batumi’s oil refineries and port operations, constituting around 21% of the city’s population.

The imperial government initiated expanding Batumi’s port in 1889 with a primary focus on oil exports. By 1895, 81.5% of all exported goods via the port was oil. In 1896, the Nobels launched the construction of Baku-Batumi oil pipeline, which significantly increased oil exports.

However, the growth of the oil industry did not improve, but rather worsened the conditions of Batumi’s workers. The first small strikes took place in 1889 at Nobel’s factories, demanding better working conditions and higher wages. However, at that time, the workers in Batumi didn’t have organized union.

In a report sent by the governor of Western Georgia to the Caucasus Viceroy in 1899, it was described that, Batumi workers' conditions were rather impoverished. Workers' wages were low, they could not access medical care, and their food was of poor quality and expensive. Due to high housing costs, workers often slept under machinery in the factories. By that time, the average daily wage of a worker was less than 1 ruble (about 0.2 British Sterling).

The formation of an organized workers' movement in Batumi began in 1897, in parallel with the emergence of the social-democratic movement. Georgian social democrats - operated independently from the Russian Social Democratic Party until 1903 - used legal channels, held positions as teachers and administrative officials, and started creating secret literacy and education circles for workers in the Batumi oil industry. Soon, these networks expanded into workers’ neighborhoods through schools, with some schools even being established on the premises of the Rothschilds’ factory.

Batumi became a very important center for Georgian social democrats. Therefore, two founding members of the movement, a teacher Isidore Ramishvili (who was executed in 1937 during Soviet repressions) and an administrative official Nikoloz Chkheidze (one of the leaders of the February 1917 Russian Revolution), served as heads of the committee. Soon, these circles actively began spreading Marxist ideas and advocating workers’ rights. Georgian social democrats, most of whom later joined the Mensheviks within the Russian Social Democratic Party, supported legal activities to advance workers' interests. As a result, in 1898, Nikoloz Chkheidze was elected to the Batumi City Council.

The underground literacy schools and libraries, established by the Social Democrats for workers soon evolved into party organizations. By 1901, there were 11 such workers' organizations within the Batumi Committee of the Social Democratic Party, and by 1903, their number increased to 20.

Although the Social Democrats largely avoided initiating large-scale strikes from 1897 to 1901,, there were individual and fragmentary protests. Their committees focused on unifying the workforce, recruiting members, and laying the groundwork for future political and economic struggles. Social Democrats also managed to gain allies within administrative and even among the military structures. By 1900, despite limited political freedom and ongoing repressions, the movement's influence hadbecome undeniable. The numerous and strong working class was mobilized around the Social Democrats.

In 1899, young Joseph Jugashvili—Stalin—began working in Batumi. However, ideological conflicts soon emerged between him and the local Georgian social democrats due to his call of revolutionary violence. They were waiting for the right moment to initiate such actions. Therefore Stalin had to move to Baku to work.

In 1901, Stalin returned to Batumi with big plans and began working at the Rothschild’s factory. By the end of 1901, a factory fire was allegedly caused by a sabotage. There is a suspicion that Stalin and the workers around him were involved in this incident. In February 1902, a conflict arose between the factory administration and the workers; the workers demanded higher wages, while the administration refused to pay. Soon, in March 1902, Stalin's group organized a large-scale strike at the factory, leading the imperial authorities to arrest the protesters. Ultimately, on March 8, 1902, workers gathered around Batumi’s main prison demanding the release of their comrades. The Batumi district administration arrested up to 500 more workers. The tension peaked on March 9, when even more thousand workers assembled around the prison for a demonstration, singing “The Internationale” and “La Marseillaise”. The imperial troops opened fire, killing 15 workers, injuring 50, and arrested hundreds.

A few weeks after the massacre on March 9, 1902, the empire’s secret police arrested Stalin. He was sentenced to exile, from which he would eventually escape. On Stalin's 60th birthday, the well-known Russian writer Mikhail Bulgakov, under the regime's directive, wrote a play “Batomi” about the revolutionary processes of 1902, in exaggerating Stalin’s role.

The execution of workers marked a turning point as new wave of strikes and protests began in Batumi. From March 1902 to March 1903, oil factory workers organized around 30 strikes. Soon, the authorities suppressed the social-democratic committees, and the leaders of the Social Democrats left the city. Ultimately, the massive unrest of 1902 nearly destroyed Batumi’s oil industry; according to official statistics, by 1904, about 5,000 jobs had been lost compared to 1902. Revolutionary workers were expelled from the city.

During the 1905 Revolution, the Rothschilds’ factory in Batumi was closed. Following the revolution, in which workers played a key role in the uprising, the city’s industrial base was permanently weakened . For comparison, in 1905, around 4,916 workers were employed in 13 large factories in Batumi, but by 1910, this number had decreased to 1,085. The decline was not only a consequence of political repression and unrest, but also a result of the geographic diversification of the global oil industry, which led to a decrease in Baku's share in the global market.

In 1902, the imperial authorities expelled Georgian social-democrat workers from Batumi. Interestingly, this did not weaken the revolutionary movement in Georgia; instead, it expanded it widely. Workers in Batumi, influenced by social democracy, returned to their villages, where they, alongside young social-democratic teachers and students, began spreading the ideology among the peasants.

About 50 kilometers from Batumi, in the Guria region (Ozurgeti District), with a population of around 105,000, the growing revolutionary activity during the 1905 Russian Revolution attracted attention from European press. Former workers, students (who supported the Mensheviks), and local teachers managed to abolish the imperial governance system and establish a local, autonomous form of self-governance based on direct democracy, women’s emancipation, and broad participation. The so-called "Republic of Guria" created by local social democrats, is often viewed as a second "Paris Commune" idea, occurring 34 years later, in one of the smallest regions of imperial Russia.

The Labour movement and revolutionary protests in Batumi played a significant role in the history of the broader Russian revolutionary context. During the Soviet era, numerous works were written about the Batumi labour movement; however, in all of them, the role of the Bolsheviks and especially Stalin was greatly exaggerated. At the same time, the significant role of Georgian Social Democrats was completely ignored or erased.