890F.515/18: Telegram
The Appointed Minister Resident in Saudi Arabia (Moose) to the Secretary of State
[Received July 14—1:37 p.m.]
66. Department’s 34, July 10, 10 p.m. No minimum can be set but 15,000,000 rials already mentioned are urgently needed. By assay one rial weighs 11.635 grams and contains 909.15 parts silver per thousand.
British plan to supply local government with credits of 225,000 pounds sterling during each of next 6 months. Saudi budget for 1943 contemplated 25,000,000 rials expenditures to be supplied by British in silver or alternatively in gold at rate of 50 rials to invite commitment [sic] British have already supplied 5,000,000 rials and 200,000 sovereigns while a third 100,000 sovereigns is expected shortly pr [sic] two further shipments each 100,000 sovereigns will certainly be requested by Saudi Government, one to make up remainder of estimate and another to compensate for loss by exchange of gold at unfavorable rate now approximating 39 rials to sovereign. It is likely [Page 875] that if 15,000,000 rials were supplied to Saudi Government British would suspend shipments of gold.
On April 24 oil company offered Saudi Government rupees equivalent to $1,000,000 half payable in dollars if such payment would effectively aid solution of Saudi currency problem. Offer still stands but has not been accepted because Saudi Government has had little opportunity to spend rupees.
Rupees circulate at Dhahran at a discount of about 27% off rials. Company desires to use rials but if they are unobtainable it expects to import 450,000 rupees which added to 350,000 now on hand will meet requirements for last half 1943.