In the context of the Middle East, oil is usually discussed in geo-strategic terms. It is presented as a disembodied source of revenue, a “curse”, a security concern, or simply as rent. This paper joins a growing body of scholarship that is critically reexamining the social and cultural dimensions of extractive industries. It asks how can we recover the social life of oil and dislodge it from the straightforward narrative of modernization that results in the modern Gulf State. In 1956, a rebellion lead by the oil workers of the Bahrain Petroleum Company struck at the center of one of the world’s most productive hydrocarbon infrastructures. For the workers, the nationalization of the oil industry would have been an obvious and yet impossible demand, for there was no “nation” to resort to. This study is concerned with the struggle to imagine one. Using local records of the rebellion in Arabic, along with the British colonial archives, I argue that the racial climate that initially framed labour relations in the oil industry contributed to the formation of a new political subjectivity in Bahrain. Common people, mostly industrial workers, became subject to a profusion of demographic categories: “local”, “foreign”, “Arab”, “Nejdi, and “Iranian”. These categories far from being innocent taxonomical delineations are endowed with meaning when they define channels of social mobility, class aspirations, and become markers of privilege and exploitation in a context where there is no recourse to the inclusive tenets of a “nation” for redemption. Nowhere does this new political subjectivity become more evident than a popular rebellion catalyzed by the Suez crisis in 1956. When sectarian divisions broke out into violence, they also activated a national imaginary that attempted to refashion this violent rupture of social relations into a consensus on the future of the state. Although the ideological raw material for the rebellion was supplied by Arab Nationalism, the national movement’s legitimacy rested on the idea of sectarian representation in government. This constituted a failure to break with the fundamental categories that had precipitated the crisis itself. Thus, the rebellion’s historical significance is derived not from the fact that it “almost succeeded”, but because it is the historical and ideological precedent that framed the national project itself in sectarian terms. This constituted a deep and continuing crisis for future attempts to create a “national consensus” that could begin to transcend sectarianism, perhaps rendering the nation itself as unimaginable.