One of the most serious international crises of the twentieth century, triggered by Egyptian president Gamal Abdel Nasser's nationalization of the Suez Canal on 26 July 1956. As the canal was under Egyptian sovereignty and compensation to its foreign shareholders was promised, this move was entirely legal. But Britain and France viewed it as a blow to their prestige and political standing in the Middle East. A few days after Nasser's announcement, they made plans for an invasion of Egypt to regain control of the canal, which were strongly opposed by the United States despite its agreement on the need to assure international access to it.
On 2 August a Franco-Anglo-American statement reaffirmed the international character of the canal and invited its main users to a meeting. On 16 August, a conference opened in London, where American Secretary of State Foster Dulles proposed creating an international organization responsible for control and management of the Suez Canal. On 9 September President Nasser rejected the Dulles Plan, and his position was supported by the Soviet Union. Three days later, France and Great Britain, with the approval of the United States, created an association of users of the canal, which, on 15 September, Nasser declared he would not recognize. Four days later, a second conference opened in London. On 14 October 1956 the United Nations Security Council defined the right of passage through the Suez Canal. On 22 October, at Sèvres, France, there was a secret meeting of British, French and Israeli political and military leaders, which concluded with an agreement for a French-Israeli-British military alliance to retake control of the Suez Canal, after which France launched "Operation Musketeer."
The preceding April, France and Israel had signed an accord allowing Israel to obtain French arms. Although the British wanted to keep the Suez Crisis separate from the Arab-Israeli conflict, France wanted Israeli assistance and in fact wished to induce Israel to attack first; it therefore speeded up the delivery of these arms. On 29 October, the Israeli Army, under the leadership of General Moshe Dayan, started "Operation Kadesh" against Egypt. The 7th Armored Brigade routed the Egyptian forces, freeing access to the Suez Canal, and the Gaza Strip was rapidly brought under the control of the Israel Defense Force (IDF). By 1 November, the artillery support of the French-British forces had incapacitated the Egyptian Air Force. The next day, President Nasser decreed martial law and seized French and English assets on Egyptian soil. On 3 November the Egyptian Army sunk several ships, thereby blocking the Suez Canal. Syrian troops arrived in Jordan, while Israelis took over strategic Egyptian positions on the Gulf of Aqaba. On 5 November, Franco-British paratroopers descended on Port Said and Port Fuad and took control of the northern entry to the Suez Canal, allowing the expeditionary corps to begin establishing control over the whole length of the canal. At this point, Soviet Prime Minister Nikolai Bulganin gave an ultimatum to Tel Aviv, London, and Paris, demanding the immediate withdrawal of their troops from Egyptian soil.
Under pressure from Washington and threats from Moscow, France, Great Britain and Israel accepted a cease-fire and agreed to withdraw. On 15 November, UN soldiers moved into the Sinai desert. On 22 December, the Franco-British forces completed their evacuation of Port Said. On 5 January 1957, U.S. President Dwight Eisenhower presented his Middle East foreign policy, based essentially on economic aid and military assistance; but on 19 January, the leaders of Saudi Arabia, Egypt, Jordan and Syria, gathered in Cairo, rejected the Eisenhower Plan. On 21 January, the UN General Assembly adopted a resolution demanding the departure of Israeli troops from Egypt. Although Israel had hoped to hold on to the Gaza Strip and the entrance to the Gulf of Aqaba, heavy American pressure and the threat of UN sanctions moved Prime Minister David Ben-Gurion to withdraw Israeli forces. On 6 March, the IDF evacuated the Gaza Strip and Sharm el-Sheikh, making way for UN units.
On 8 April 1957, the Suez Canal was reopened to maritime traffic. In July, the Soviet Union began delivering large quantities of arms to Egypt. On 21 August, 1958, the United Nations General Assembly, at the initiative of the member states of the Arab League, approved a resolution demanding that the Middle East be kept out of the quarrels between the United States and the Soviet Union. The Suez war is generally considered a major blunder on the part of Britain and France, for it led to the loss of their positions in the Middle East and marked the end of British and French colonialism, as well as increasing U.S. power in Middle Eastern affairs. Egyptian President Nasser, on the other hand, emerged as the uncontested leader of the Arab people.