893.6363/7–1349: Telegram
The Consul General at Shanghai ( Cabot ) to the Secretary of State
Shanghai
, July 13,
1949—10 p. m.
[Received July 13—9:38 p. m.]
[Received July 13—9:38 p. m.]
2752. Vice Chairman SMCC Foreign Trade Bureau met representatives all principal oil companies July 12 discuss basis future market. On this occasion companies were advised as follows:
- 1.
- Re mogas, Government plans all present stocks future imports be sold to Government ex-main terminal. In view oil companies’ investment filling stations, other distribution facilities, it is contemplated, however, that while sale to large consumers would be from Government-owned product ex-major terminals smaller buyers would be supplied through existing distribution facilities oil companies but with companies acting as agents Government, on basis handling charges, other allowances to be agreed upon. Details re actual working arrangements still unclarified and oil companies’ suggestions invited.
- 2.
- For black oils, Government envisages system strict rationing and price control but with ownership product remaining with importing companies which is substantially same system as previously existed.
- 3.
- For kerosene, lubricating oils, Government plan is for the present distribution remains in oil companies hands with understanding that Government be advised currently of prices which should be kept on fair basis.
- 4.
- While avigas not presently required, Government plan is that it would come under marketing arrangements similar to those for mogas.
- 5.
- On all products system import quotas is to be discontinued and business kept on competitive basis with understanding that after import licenses have been issued importers would be permitted purchase exchange on free market. Under what conditions import licenses would be issued or how free market will operate remains unclear.
- 6.
- Oil companies were requested submit soonest possible (a) quantities mogas they desire turnover Government corporation as well as price at which offered; (b) their views regarding fair selling price for all petroleum products with details as to basis calculation; (c) periodic reports covering deliveries and stocks on hand.
Oil companies Shanghai endeavoring supply information above requested.
Please advise Washington representatives Standard-Vacuum, Caltex for information their New York offices.
Cabot