File No. 659a.119/27

The Chargé in Great Britain ( Laughlin ) to the Secretary of State

[Telegram]

10919. War Trade Board [from Sheldon]:

No. 904. Referring to our numerous telegrams with reference to the Iceland agreement, to none of which we have had replies, the following is a paraphrase of a telegram from the British consul in Iceland just received by the Foreign Office:

Today I received a call from Prime Minister. He expressed a great anxiety know whether War Trade Board had yet notified their adhesion to Icelandic agreement. He was much concerned regarding delay in granting clearance to Villemoes, Fredericia and Gullfoss. He said that one of the most vital points of the agreement was that clearances should be expedited, but that since the agreement conditions were worse instead of better. Private information had reached him from Copenhagen that Danish financial and business circles looked on the agreement as being a colossal blunder on the part of Iceland, and that by it Iceland would lose 20,000,000 kroner. He pointed out that if the apparent advantages of the agreement to Iceland were rendered void in practice, his defense of it against criticism would become impossible. He expressed great surprise that the petroleum contract, signature of which had been expected within a week of conclusion of agreement, had not yet been settled.

The London representative of the Icelandic Government Trade Department has received the following cable from the Icelandic Government Trade Department dated the 25th instant:

Message from New York says Villemoes still there waiting license for oil. Representative bought from Standard Oil Company 5,000 casks, with approbation of American authorities. We were long ago informed that Villemoes should load oil when back from Cuba, therefore surprised that vessel delayed now, causing great loss, after American Government chartered same at low rate. Please point out to association that according to agreement, we expect quick despatch of our rations. We therefore expect Villemoes shall not be undecisively delayed at New York as Gullfoss and other vessels in the past.

Laughlin