825.6363/401: Telegram

The Acting Secretary of State to the Ambassador in Chile (Bowers)

659. Further in connection with your 960 of June 2, Department has just been informed that according to estimates of the local petroleum companies, which are believed to be reliable, existing stocks and scheduled arrivals will last until the middle of July if consumption is reduced to levels contemplated by pool formula quantities.

Assuming this is correct, it would be possible by means of limiting deliveries into consumption to 60 per cent of quota quantities to make stocks last until early August when normal pool supplies will be resumed. It is assumed that although 60 per cent of pool allotments represents a sizeable reduction, no serious harm to the Chilean economy would result during the short period of time in which the reduction would be in effect.

It would seem the part of prudence for the Chilean authorities to limit consumption to levels sufficient to make stocks last until early August. Meanwhile Department is continuing investigation of relief possibilities.

Stettinius