The Ambassador in Germany (Dodd) to the Secretary of State

No. 1186

Sir: I have the honor to refer to the Department’s No. 258 of July 31, 1934,19 anent the reported intention of the German Government to [Page 322] increase the existing storage requirement of the three major oil companies operating in Germany and to secure their acquiescence in the non-transfer of the proceeds of their sales in Germany for a period of five years.

In the course of a visit by Geheimrat Breme, who is the principal legal representative of the Standard Oil interests in Germany concerning another matter of importance to his company, inquiry was made as to developments in connection with the above mentioned matter. He gave the following background:

The Standard has a contract with the I. G. Farben industry for distributing liquid fuel products made from coal, in which, if Geheimrat Breme was rightly understood, the Royal Dutch Shell (or its subsidiary) could also participate through the Standard. The Shell Company, however, and the Standard have different points of view in regard to liquid fuel manufactured or produced from coal. The former desires to impede its production whereas the Standard considers that if coal products of this kind are, economically speaking, viable, their marketing can not be stopped—especially as efforts to do so would mean, in Germany, fighting a native in favor of a foreign product.

The Shell, appreciating that neither the Standard nor the Anglo-Persian can subscribe to a proposition such as that contained in the enclosure to the Department’s 258 under reference, made their offer to the German Government conditional upon its acceptance by the Standard and Anglo-Persian, thereby putting the onus on them of refusal. Naturally, the German Government, when faced with an offer so favorable to it, is disposed to take the matter into consideration to see what can be done in that connection. Mr. Breme said that further negotiations were to be anticipated.

Asked as to the connection of Dr. Feder with oil questions considering that he was now occupied with the land settlement scheme, I was informed that Dr. Feder nevertheless evinced a continued interest in these questions, and, as he was a very old member of the Nazi Party, no one had thought fit to prevent his maintaining his connection therewith, although there were other officials perhaps more qualified for the work.

Respectfully yours,

For the Ambasador:
J. C. White

Counselor of Embassy
  1. Not printed; it merely transmitted copies of the memoranda dated July 17 and 25, 1934, supra.