Foreign Relations of the United States, 1949, The Near East, South Asia, and Africa, Volume VI

501.BB Palestine/7–2049: Telegram

The Secretary of State to the Embassy in the United Kingdom

confidential

Washington, July 20, 1949—6 p. m.

2515. Ref Deptel 2232, June 29.¹ Dept’s views re renewed effort reopen Haifa refinery and pipeline on basis free port proposal as fol:

While in principle no objection perceived channeling proposal through PCC scope Lausanne talks likely be limited immediate future questions refugees, territory, and Jerusalem. Ethridge’s² favorable response to idea PCC approach made at time when it was hoped initiate discussions economic problems but efforts by PCC this direction proved fruitless at least for time being Arabs not having sent economic specialists Lausanne and Israelis having withdrawn theirs.

PCC approach furthermore cumbersome and likely ineffective in view Iraqi non-participation Lausanne discussions and current refusal be associated with PCC in any manner. Thus, though possible approach Israel through PCC, Iraq must be contacted through regular diplomatic channels by three Govts.

In light above Dept believes direct approach by three Govts Israel followed by similar representation Iraq likely bring best results. Such discussions might be held London where all parties represented.

You are authorized communicate this view FonOff and to your Fr colleague and if they concur to discuss with them terms in which direct representations might be framed. Suggest you obtain additional views re free zone proposal for oil installation since Brit approach on subj fails cover physical or polit practicability. Furthermore according urtel 2715 July 12³ wld appear increased royalties possibly controlling factor.⁴

Acheson

1. Not printed.
2. Mark F. Ethridge, United States Representative on the Palestine Conciliation Commission.
3. Not printed; it advised of information from the British Foreign Office that the IPC negotiations continued deadlocked, that the Iraqis had nearly broken off negotiations and that they had been dissuaded from returning home, in order to continue negotiations (890G.00/7–1249).
4. This telegram was repeated to Paris and Bern (for the American Delegation at Lausanne) and sent by air to Baghdad and Tel Aviv. London, on July 22, reported the preliminary reaction of the British Foreign Office to the Department’s views. The Foreign Office was said to be “considering following alternative course of action with Iraq, which … would require careful handling and timing; now that Syrian armistice agreement has been concluded, time is approaching when it may be propitious lift arms embargo. … At such time as lifting embargo appeared imminent (or perhaps after actually lifted), British would point out to Egyptians that Britain would be more amenable shipment arms if Egypt permitted passage tankers through Suez with Persian Gulf Oil for Haifa. If Egyptians agreed permit such shipment, Foreign Office feels Iraqis might then agree reopen pipeline since they could point to Egyptian action as deciding factor, thereby saving own face.” (telegram 2894, 501.BB Palestine/7–2249) For documentation on the Syrian armistice agreement and the arms embargo, see pp. 594 ff.