Memorandum by the Assistant Secretary of State ( Clayton ) to President Roosevelt 43

The following comments will indicate, I believe, that foreign oil matters are in hand and therefore need not receive attention at the expense of other matters at your forthcoming meeting abroad.

Our foreign oil policy should seek the development of Middle Eastern oil for peacetime commercial purposes in order to promote, for our national security, the relative conservation of strategically located Western Hemisphere supplies. Since there is sufficient Middle Eastern oil to supply world markets for the forseeable future, this Government should not look upon those distant fields as security reserves but as sources of peacetime supplies for Eastern Hemisphere markets so that oil exports from the Western Hemisphere may be curtailed. Accordingly, we should endeavor to (1) safeguard Middle Eastern concessions now held by American companies, and (2) encourage the companies to expand Middle Eastern production.

As you know, in the Anglo-American petroleum negotiations the British and ourselves agreed upon principles in line with this objective. These were embodied in the Anglo-American oil agreement,44 and it is our intention to preserve them although the agreement will be revised in early renegotiations with the British45 to remove certain ambiguities.

The British and ourselves have declared our intention of working toward a multilateral oil agreement with other interested governments, including of course the Russian Government. However, it is felt that oil discussions should not be held with that Government until we can determine more clearly the basis on which governmental oil systems [Page 37] and privately owned oil industries can meet. The Russians hold no concessions in the Middle East, the concessions there, as you know, being controlled by the British and ourselves, and the Anglo-American agreement should take care of all British-American oil problems in the area. When the Russians recently sought a concession in Iran, while American and British interests were also negotiating there, the Iranian Government decided to grant no new foreign concessions.46 We recognized that such a decision rested solely with the Iranian Government, but expressed the hope that if in future Iranian concessions should be granted to foreigners, American interests would have equal opportunity with the nationals of other countries.

We are now actively developing with the British a program to assure oil supplies to France and other liberated areas. As soon as the program has been sufficiently developed, it will be laid before other interested governments.

W[illiam] L. C[layton]
  1. Not sent; this memorandum was drafted in the Petroleum Division on January 19, 1945, to brief President Roosevelt on American foreign oil policy in connection with his forthcoming conference with British Prime Minister Churchill and Soviet Premier Stalin at Yalta. In an attached memorandum of January 22, 1945, to John E. Orchard, Special Assistant to Mr. Clayton, the Assistant Chief of the Division of Coordination and Review (Daniel) stated: “For reasons which you will understand we are not sending anything more to the White House for the President’s special attention.” (811.6363/1–2245) President Roosevelt left Washington on January 22.
  2. For the text of this unperfected agreement of August 8, see Department of State Bulletin, August 13, 1944, p. 154; for negotiations leading to the agreement, see vol. iii, pp. 94 ff.
  3. See footnote 36, ibid., p. 127.
  4. See telegram 895, December 3, from Tehran, p. 479.