The reasons for the British decision to withdraw from the Gulf are highly contentious. While some scholars have focussed on short-term considerations, especially the devaluation of sterling towards the end of 1967, in the British determination to quit the Gulf, others have concentrated on longer-term trends in British policy-making for the region. This article sides with the latter. Britain's Gulf role came under increasing scrutiny following the 1956 Suez crisis as part of an ongoing debate about the costs and benefits of Britain's Gulf presence. In this sense, British withdrawal fitted into a wider pattern of British decolonization. By the 1960s, the Treasury, in particular, strongly questioned the necessity and cost-effectiveness of the maintenance of empire in the Gulf to safeguard British economic interests there. Recent interpretations which seek to disaggregate the British decision to leave South-East Asia from the decision to depart from the Gulf are also questionable. By mid-1967, it had already been determined that Britain would leave both regions by the mid-1970s, the only difference being that this decision was formally announced with respect to the South-East Asia, but not with regard to the Gulf. The devaluation of sterling in November 1967, therefore, merely hastened and facilitated decisions which had already been taken. Despite the end of formal empire in the Gulf, Britain did seek, not always successfully, to preserve its interests into the 1970s and beyond.The British decision, announced in January 1968, to withdraw from the Persian Gulf arguably represented one of the last major acts in British decolonization. Musing on the ostensible relinquishment of Britain's identity as a world power ushered in by the impending departure from East of Suez, of which the presence in the Gulf was a key component, Labour Cabinet minister and diarist, Richard Crossman, observed: 'the status barrier is as difficult to break through as the sound barrier; it splits your ears and is terribly painful when it happens'. 1 Reflecting on the determination to withdraw, former Labour Foreign Secretary, Patrick Gordon Walker, characterized it as 'the most momentous shift in our foreign policy for a century and a half'. 2 How far this 'momentous shift' stemmed from either a longer-term assessment of British interests, or rather a response to short-term domestic British exigencies, is a contested issue. Some historians, in particular Saki Dockrill, Matthew Jones, Wm. Roger Louis, and also myself, have focussed on the gradual erosion of the commitment East of Suez over an extended period. 3 More recently, others have paid attention to short-term domestic political changes in Britain, especially those following the devaluation of sterling in November 1967. A re-examination of Britain's decision to withdraw from the Gulf is, therefore, timely.