811.20(D) E.D.B./1789: Airgram
The Chargé in Argentina (Reed) to the Secretary of State
[Received September 22—4:20 p.m.]
A–196. Department’s telegram 1141 of July 31, 7 p.m.24 The Embassy is informed by the Standard Oil Company that their appeal [Page 447] for Ethyl fluid was again refused. It is presumed that the Y.P.F. stock of 27 drums plus the Army reserve of 59 drums is the cause of a prohibition on the shipment of more Ethyl to Argentina. To make sure that the Department is fully informed as to the Embassy’s estimate of the effect of cutting off Standard’s supplies, the Embassy wishes to note some probable results:
- (1)
- Standard is now using approximately three drums of Ethyl aviation fluid per month, and therefore will be out of stock about the end of November.
- (2)
- This will leave Y.P.F. as the only source of aviation gasoline in Argentina, which will force Corporación, Condor, Aeroposta, and all other local business, into Y.P.F. hands, and take away from the United States any possible means of exerting pressure because of control of the fuel source.
- (3)
- Since Y.P.F. have only 27 drums of Ethyl fluid available for civilian use, and are consuming five drums monthly for current military consumption, it might be that the military authorities would refuse to permit Y.P.F. to deplete their stocks by the additional two drums monthly needed for Pan American. This action would make it unnecessary to draw upon Army reserves until about February, 1943, but it would ground Pan American planes.
- (4)
- There is the possibility that Standard’s stock of codimer blending fluid might be requisitioned by Y.P.F. when Standard’s Ethyl supplies are exhausted, on the ground that only Y.P.F. had facilities for making aviation fuel. This would make Standard unable to furnish 100 octane fuel for United States purposes if required because of an emergency.
- (5)
- A by-product of this situation would be the elimination of Intava from the market, which would strengthen Y.P.F.’s efforts toward securing a petroleum monopoly.
The 86 drums of Ethyl fluid now held by Y.P.F. would last for 17 months, at the present rate of use. The addition of three drums a month to the consumption, to cover Standard’s present production, would exhaust the stocks in 10 months. This difference of 7 months seems to the Embassy scarcely sufficient to compensate for the political and other damage to the United States which might result through cutting off all further supplies of Ethyl fluid to the Standard Oil Company. As you know, their aviation gasoline output is sold through Intava and goes only to consumers approved by the United States.
- Not printed.↩