890F.6363/12–1144
The Secretary of the Navy (Forrestal) to the Secretary of State
My Dear Mr. Secretary: On 27 October 1944, the Secretary of War sent me a copy of a letter addressed to the Secretary of State under date of October 23 [27], 1944, relating to the War Department’s interest in Saudi Arabia. It is my purpose to set forth here the strategic interest of the Navy in this same area.
Our interest is twofold: 1. The supplementing of Western Hemisphere oil reserves as a source of world supply.
The operations of the Navy, including the Naval air arm, in peace as well as in war, are dependent to a large degree upon the availability of refined petroleum products. The certain availability of such products, in turn, depends in time of crisis upon the existence of adequate reserves of natural crude petroleum in areas so situated geographically as to assure their availability to the United States.
The known reserves of natural crude petroleum in the Western Hemisphere have for years been the foremost contributors to the various uses of petroleum throughout the world, and have been more fully developed and exploited than the reserves in other areas. Indeed, there is a substantial body of expert opinion that the known reserves of natural crude oil within the continental limits of the United States are inadequate to supply the civil economy as well as the needs of the armed forces of the nation over any considerable period of years. The degree of accuracy of this opinion, or the extent [Page 756] to which the severity of its conclusion is mitigated by the possibilities of the discovery of new reserves or the growth in the use of synthetic fuels, are not currently susceptible of precise determination; but, obviously, in a matter of this kind, the Navy cannot err on the side of optimism.
The largest known oil reserves outside of the Western Hemisphere are located in the Mesopotamian Basin in the area of the Persian Gulf. These reserves are largely undeveloped. It is distinctly in the strategic interest of the United States to encourage industry to promote the orderly development of petroleum reserves in the more remote areas such as the Persian Gulf, thereby supplementing the Western Hemisphere sources and protecting against their early exhaustion at inefficient rates of production.
2. The expansion, or at least the preservation of the continuity, of ownership by United States nationals of oil reserves outside of the continental United States.
The prestige and hence the influence of the United States is in part related to the wealth of the Government and its nationals in terms of oil resources, foreign as well as domestic. It is assumed, therefore, that the bargaining power of the United States in international conferences involving vital materials like oil and such problems as aviation, shipping, island bases, and international security agreements relating to the disposition of armed forces and facilities, will depend in some degree upon the retention by the United States of such oil resources. The strategic interests (military and naval) of the United States will, of course, be profoundly affected by the agreements which issue from such conferences. Under these circumstances, it is patently in the Navy’s interest that no part of the national wealth, as represented by the present holdings of foreign oil reserves by American nationals, be lost at this time. Indeed, the active expansion of such holdings is very much to be desired.
In view of the foregoing, it is my own considered judgment that the Government, through the State Department, should work out a program, carefully conceived and far-reaching in its effect, which would result in the greater use, now and in the peacetime years ahead, of petroleum products made from oil produced in the Mesopotamian Basin and other overseas areas. At the same time, the good offices of the State Department should be used to the greatest possible extent to promote the expansion of United States oil holdings abroad, and to protect such holdings as already exist, i. e., those in the Persian Gulf area.
You may be sure that in the development of such a program and in carrying it out, this Department will cooperate in every way possible.
Sincerely yours,