The Director of the Office of American Republic Affairs (Duggan) to the Ambassador in Mexico (Messersmith)

Dear George: The only fly in the ointment that developed in connection with Padilla’s visit has to do with the basic petroleum discussions. I have asked Charlie Rayner67 to prepare a memorandum68 that will chronicle this episode from beginning to today’s developments since the end is not yet in sight.

Briefly, what happened is that the President, despite his instructions to you last winter and despite a memorandum69 on the subject which we sent him just prior to Padilla’s arrival, encouraged Padilla to believe that he favored development of Mexico’s oil resources through government-to-government cooperation. The President himself suggested that Padilla see Ickes about details and Ickes told Padilla that the two governments could cooperate on the general proposition just as they had on the high-octane plant.70

We are now trying to get this back on the track. Ickes seems cooperative; in fact he recognizes the danger that the President’s procedure has for the success of the forthcoming negotiations with the British. Moreover, Ickes says that he told Padilla that the proposal must come through the Department.

However, and very confidentially, the Secretary is worried that the President, even though he may now be straightened out, will forget and revert to his idea.

I am certain that Padilla went away very confused on this whole matter. I am sorry that I did not know about it until Wednesday afternoon when it was then too late to have a talk with Padilla.

Sincerely yours,

Laurence Duggan
  1. Charles B. Rayner, Acting Chief of the Petroleum Division.
  2. Not found in Department files.
  3. Memorandum dated July 4, 1944, not printed.
  4. For correspondence on the high octane plant, see Foreign Relations, 1943, vol. vi, pp. 452 ff.