893.6363/6–2449
Memorandum by the Assistant Chief of the Division of Chinese Affairs (Freeman) to the Deputy Director of the Office of Far Eastern Affairs (Allison)
Subject: Discussion with Mr. Jones, British Petroleum Attaché, Regarding Shipments of POL to China
[Page 1016]In a discussion this afternoon with Mr. Jones, which was attended by Mr. Moline36 and Mr. McBride of PED, both sides of the Chinese penny with regard to shipments of petroleum were brought up.
We first presented that matter brought to the Department by Colonel Kavanaugh37 regarding the desire of the Chinese Petroleum Corporation to conclude a 3 to 5 year contract with Caltex for the shipment of crude oil to Hulutao. Mr. Jones expressed complete agreement with the Department’s position that it would be undesirable for either Caltex or the Anglo-Iranian Oil Company to conclude a long-term contract with the Chinese Communists at this time. He also expressed agreement with the desirability of continuing small shipments on a single contract basis to Hulutao and assured us that he would bring the matter to the attention of his government immediately with the idea of seeking assurances from the Anglo-Iranian Oil Company that they would adopt a position similar to that of Caltex.
The second matter, that of the delivery of 60,000 barrels of aviation gasoline to Formosa, was also discussed with its various ramifications. As could be expected following the bombing of the Anchises38 Mr. Jones again expressed complete agreement with the suggestion which had been made to Stanvac that they endeavor to adopt a common front in this matter together with the other American oil distributors and refrain from submitting bids. Mr. Jones went on to say that Anglo-Iranian would probably be the only British or Canadian company in a position to supply such a large amount of aviation gasoline and that he felt sure that that company would be responsive to a British Government suggestion as to the undesirability of concluding such a contract at this time. Mr. Jones added that he would also bring this matter to the attention of his government.