Memorandum by the Acting Petroleum Adviser (Rayner) to the Secretary of State

Mr. Secretary: I called on Secretary Ickes this afternoon and advised him that it was your intention to call in, at an appropriate time, the top officials of oil companies operating abroad5 and to advise them in confidence of the forthcoming conversations with the British; also, that their advice would be sought from time to time as the conversations progressed.

Secretary Ickes said that he had just received your letter of January 5 disapproving of any further negotiations with the oil companies for stock participation by this Government pending the development of the discussions with the British. He indicated his belief that we were working at cross purposes and that the position taken in your letter was contrary to the President’s wishes. He, therefore, intended to put the matter before the President for decision.

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He spoke at some length on the value of government participation in foreign oil reserves through stock ownership as a means of protecting our national interests. However, after some discussion he admitted that there may be possible desirable alternative courses of action which would accomplish the same purpose without involving the disadvantages of government stock ownership in American corporations.

The membership of the group to carry on the conversations with the British was not mentioned by Secretary Ickes and I did not bring up the subject.

In view of Secretary Ickes’ statement, as indicated above, that he intended to take up with the President the subject of your letter of January 5 to him, it is believed that you may wish to advise the President concerning the reasons for the position you take in that letter. For that purpose a brief memorandum to the President is attached for your consideration.6

Charles B. Bayner
  1. This was done in letters of January 24 to these officials by the Secretary of State (800.6363/1455f).
  2. See memorandum of January 8, p. 15.