Memorandum by the Secretary of State to President Roosevelt

As you know, the Petroleum Reserves Corporation has negotiated for governmental participation in companies holding oil reserves in the Middle East. As you also know, this Government is going to conduct conversations with the British on Middle Eastern oil.

The broad objectives of these conversations, which look to the assurance of supplies for peace time and security needs as well as [Page 16] benefits to the countries owning the resources, encompass the purpose for which the Petroleum Reserves Corporation’s negotiations were undertaken. However, it is not now possible to determine whether the Petroleum Reserves Corporation’s negotiations would be consistent with the course we may decide to follow as a result of the conversations with the British.

Therefore, I believe that negotiations of the Petroleum Reserves Corporation looking to governmental participation in companies having foreign reserves should be held in abeyance, and I have advised Secretary Ickes accordingly. The question of further negotiations of this nature can be reexamined, of course, at a later period in the light of the developments connected with the conversations with the British.

C[ordell] H[ull]