Foreign Relations of the United States: Diplomatic Papers, 1942, Europe, Volume III

811.20 (D) Regulations/5453: Telegram

The Secretary of State to the Ambassador in Spain (Weddell)

Washington, January 8, 1942—7 p.m.

18. Your 1017, December 6, 5 p.m.² The memorandum² was handed to the Spanish Ambassador³ on November 29 but no further action was taken for the reason that he suggested certain modifications which necessitated further consideration in this Department. The following is the full text of the memorandum as finally determined:

“The proposals submitted herewith have been prepared to accommodate trade to the complexities of the present situation and to ensure that products made available shall not aid the enemies of the United States. The proposals contemplate a movement to Spain of products, including petroleum products, conditional upon Spain making available to this country (or possibly to this country and Great Britain through a joint arrangement) in significant quantities the products of Spain mentioned below.

“While it is desired to permit the supply of Spain’s requirements of products urgently needed to continue, in order to accomplish this the principle must be accepted that such products will not be employed in any manner useful to the interests of Germany or Italy or countries occupied by Germany or Italy. It must be agreed, for example, that petroleum products will not be made accessible by Spain to foreign shipping or aircraft, except of American nations or of Great Britain or of countries which, in alliance with Great Britain, are at present resisting aggression, and that such products will not be reshipped from continental Spain or from other Spanish territory except to another destination in continental Spain or other Spanish territory, and that products in general supplied under this plan will not be employed in any manner to assist the other countries referred to, directly or indirectly.

“It is proposed to permit the supply of petroleum products to be continued in quantities sufficient but only sufficient to meet Spain’s requirements for transportation and other essentials. In this connection it is further proposed to regulate supplies, not only in the aggregate but as to the various types of petroleum products, their uses, and the inventories of these in the various zones of distribution in Spain. It is not felt that the regulation contemplated will impose any hardship on the organizations of CAMPSA⁴ or CEPSA,⁵ in as much as all of the data which will be required are presumably in their possession in the ordinary routine of their operations. The following features are proposed as a basis for the procedure to be followed:

• “(1) Subject to the satisfaction of the foregoing conditions, a supply of petroleum products will be maintained to Spain sufficient but only sufficient for Spain’s essential requirements, taking into consideration supplies from all sources. In conference with the competent British authorities, surveys will be made of Spanish consumption of the various petroleum products, and of the inventory levels necessary for securing a continuity of distribution, taking all time factors into consideration.
• “(2) No reexports of petroleum products will be permitted, either from continental Spain or any Spanish possession, except to another destination in Spanish territory, and no foreign shipping or aircraft, except of American nations or of Great Britain or of those countries which, in alliance with Great Britain, are resisting aggression, will be directly or indirectly supplied.
• “(3) In the exercise of the proposed control the cooperation of the Spanish Government will be required in the following particulars:
  • “(a) Monthly reports will be required from the CAMPSA and CEPSA organizations and any other agencies public or private owning or dealing in petroleum products, setting forth all deliveries of petroleum products, sources of supply, consumption, and inventories, detailing every type of product by region.
  • “(b) Monthly reports will be required from the same organizations setting forth the movements of all tankers or other ships engaged in the transport of petroleum products in the Spanish trade, regardless of whether such vessels are in the operation and control of Spain, with full descriptions of cargoes, names of vessels, ports of call, dates of entering and clearing such ports, and deliveries made there or elsewhere.
  • “(c) It is intended to use the following classifications in these reports:

    (a) Crude oil

    (b) Gasoline (subdivided according to various octane grades).

    (c) Kerosene

    (d) Gas oil

    (e) Fuel oil

    (f) Lubricating oils (classified as aviation, automobile, railway, miscellaneous industrial).

    (g) Greases

    (h) Asphaltic materials.

    (i) Refinery stocks in process

  • “(d) In the compilation of these reports reference will be made to the regions ordinarily served from each oil port of delivery and the situation prevailing in each of the regions will be fully reported with adequate description. In the more important regions, it is thought that ports of delivery of lesser importance may be included. The following arrangement of the regions contemplated may be modified to conform to areas for which records are available without undue difficulty or delay.

    1. Barcelona (including Tarragona)

    2. Valencia (including Alicante)

    3. The zone from Cartagena to Sevilla, inclusive

    4. The northern coast, including Gijón

    5. Coruña to Vigo, inclusive

    6. The Canary Islands, excluding the CEPSA refinery

    7. The CEPSA refinery

    8. Spanish Morocco

    9. Tangier

    10. The Balearic Islands.

  • In each case the area covered including the districts of the interior should be explicitly defined.
  • “(e) In order to minimize delays by reason of inadequate information, it is suggested that the Governments of the United States, Great Britain, and Spain establish in consultation a method of subjecting movements of petroleum products to regulation. For this purpose this Government would appoint agents who, in consultation with the British and the Spanish, would carry out the necessary work. It is thought that these agents may best be attached in some capacity to the staff of the American Embassy in Madrid. These agents must have access to all Spanish oil receiving, refining, storage, and shipping facilities for the purpose of observing, recording, and reporting quantities and qualities of products.
  • “(f) Monthly forecasts will be required of ship movements and cargoes contemplated, for 3 months ahead to facilitate planning at points of supply.
• “(4) Statements will be required from time to time estimating the consumption of the various petroleum products, in accordance with the above classifications, by uses in each region. The following uses are contemplated:

  (a) Industry

  (b) Transportation

  (c) Private consumption

  (d) Agriculture

  (e) Spanish ships

  (f) Ships of each other nationality

  (g) Military and naval uses.

• “(5) The following information is desired for the month of December and for each of the 5 preceding months:

  (a) Consumption of each product in each district, classified according to use.

  (b) Receipts by districts and products, showing origin, name of ship, and dates of loading and unloading at each port.

  (c) Inventories by districts and products.

  (d) Transfers between districts by products.

  (e) Reexports from each district by products, showing the shipping and receiving ports, name of ship, and dates of loading and unloading at each port.

  (f) Quantity of crude charged to refinery and quantities of each product produced.

• The foregoing items are likewise to be estimated in advance, in so far as is practicable, for the months of January, February, March, and April 1942.
• “(6) Estimates of inventories will include the inventory of Tenerife, taking into consideration transport time from the Islands to the mainland.
• “(7) Upon receipt of the above data from the Spanish Government, the necessary decisions will be taken by this Government in consultation with the British Government, to determine the types of products and the provision to be made.

“Other Products

• 1. Spain’s need for other products will be considered subject to supply conditions existing here and provided the Spanish Government will furnish satisfactory assurances that they will not be reexported except from one Spanish destination to another Spanish destination, and that none of the products furnished will be employed in a manner to benefit, directly or indirectly, the interests of Germany, Italy, or Japan or countries occupied by Germany, Italy, or Japan.
• “2. Certain foodstuffs are believed to be purchasable in the market.
• “3. To some extent fertilizers are purchasable in the market. Export license applications for reduced quantities of these, obtained by purchase in the market, will be given consideration individually.
• “4. Tractors, trucks, rubber, electrical supplies, machinery, metals, and some fertilizers are in scarce supply in this country and come within the control of priorities. The export of rubber has been forbidden except to countries actively resisting aggression. Similar orders are being administered as regards automobiles, trucks, tractors, and machinery generally. They result from the demands of the war effort, and do not imply any discrimination against neutral destinations. But to the extent to which they apply from time to time they will effectively prevent export to Spanish destinations. Other articles subject to priorities it is not possible to obtain for export or for use in this country except under special order of the Office of Production Management, based in each case upon the merits of the specific application detailing the use for which the desired commodity is intended and the relative importance of that use. Applications for commodities destined for military use cannot be supported, and with regard to other products the attitude of this Government will be dictated by the following considerations:
  • “(a) whether Spain is at present supplying these products to Germany or Italy or countries occupied by Germany or Italy, and
  • “(b) whether the supply of such products by this country would encourage an increased supply of other products to the countries just referred to.

“As regards products the demand for which is more or less regular and can be foreseen, among which fertilizers may be cited, the Board of Economic Warfare has under preparation forecasts of requirements for various destinations for the coming year which are being placed before the Office of Production Management to facilitate the allotment of a fixed total quantity for each destination for the year 1942. Full consideration will be given forecasts which the Spanish Government may care to submit respecting Spain’s needs, but such estimates must be fully supported and stripped of non-essentials.

“Spanish Products

It is the expectation of this Government to obtain for this country certain specific Spanish products, and the supply to Spain of the products referred to above, including petroleum products, will be conditional upon Spain’s moving to this country the following items in significant quantities; means, terms, and conditions to be the subject of discussion:

Tungsten, Cork, Tin, Fluorspar, Olive oil, Olives, Lead, Zinc concentrates, Mercury, Aconite root, Colchicum seed, Psyllium: seed, Gentian root, Ergot, Camomile leaves, Horehound leaves, Uva-ursi leaves, White squill.

“Admission of Certain Articles into Spain

It is the hope of this Government, moreover, that the Spanish Government will engage to facilitate the admission into Spain of certain articles normally featured in the exports of this country to Spain, such as:

• Printed matter, current publications, et cetera
• Motion picture films.”

You are instructed to deliver this memorandum to the Spanish Government at the earliest opportunity.

Hull

2. Not printed.
2. Not printed.
3. Juan Francisco de Cárdenas.
4. Compañía Arrendataria del Monopolio de Petróleos Sociedad Anónima.
5. Compańía Española de Petróleos, Sociedad Anónima.