835.796/180: Telegram
The Ambassador in Argentina (Armour) to the Secretary of State
[Received September 17—12:50 a.m.]
981. Embassy’s despatch No. 3051, September 5.49 Reliably informed that YPF planning to negotiate contract with Lati covering 1,000 liters50 monthly aviation gasoline, which may cover Condor requirements in Argentina and perhaps leave a surplus for building reserve stocks.
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Also I feel our position somewhat weakened by the fact that American company Intava supplies Condor. Local Standard Oil officials say Intava could cease supplying Condor in Argentina, but such action would cause lawsuit in Brazil, where Standard Oil contracted with Condor for supplies in Argentina and Chile as well. It is again emphasized that key to situation is in Brazil, as relatively little advantage accrues in stopping Condor or Lati here as long as Lati flies Atlantic.
Possibly restriction of export permits on ethyl fluid would offer excuse to Standard Oil for canceling Condor contracts in all three countries. If the Department desires to approach the matter from ethyl fluid standpoint, it is suggested that Ethyl Corporatión representatives in Argentina, Brazil and Chile be advised immediately, so that Buenos Aires agency can serve notice on YPF regarding Lati and possibly Condor without delay.
Regarding Department’s instruction No. 1162, September 6,49 [urge] strongly that Lineas Aéreas Transcontinentales Italianas (Lati) be added to Argentine section of our Proclaimed List without delay.
It is suggested that addition of Air France to such be deferred pending developments, unless Department is certain that resumption of line means threat to our interests, and that name should be included to forestall its obtaining fuel supplies if and when service resumed.
Repeated to Rio de Janeiro.