Foreign Relations of the United States, 1952–1954, The Near and Middle East, Volume IX, Part 1

886A.2553/5–154: Telegram

No. 342
The Ambassador in Saudi Arabia (Wadsworth) to the Department of State¹

secret
NIACT

Dhahran, May 1, 1954—6 p.m.

164. Re first sentence Department telegram 180, April 28 to Dhahran.²

1. On April 29 I discussed Deptel 179, April 23³ with Aramco executives Davies, Ohliger and Owen. We reviewed recent developments and past instructions and concurred desirability my handing King written communication as follows: “I am directed by my Government to inform Your Majesty that, on basis of what it has learned about the so-called Onassis tanker agreement, which was confirmed by Your Majesty’s decree of sixth Shabat, my Government is concerned over its effects on American interests, both those of private American companies and those of American national defense.

I am to refer in particular to the apparent stopping of United States Government tankers (specifically those operated by or under the control of the Maritime Sea Transport Service of the American Navy) from lifting at Ras Tanura oil from Saudi-Arabian fields; and I am to request Your Majesty’s assurance that the transportation of such oil by these tankers will not be affected by this agreement.

I am to state also that my Government shares the opinion of Aramco, as already communicated to Your Majesty’s Government, and of other interested private American companies that this agreement is not in keeping with the Aramco concession agreement with Saudi Arabia”.

2. King received me April 30 and, after greetings, permitted me, as is customary, enumerate subjects I wished discuss. He replied would first discuss Onassis matter, whereupon I suggested Prince Faisal read him Arabic translation my communication. This was done. (Note: King’s weak eyesight does not permit him read ordinary type.)

3. King replied “the Ambassador is right in bringing this to me.” He then stated emphatically (and later reiterated) “United States Navy tankers are unaffected by this agreement.”⁴ He seemed to be addressing Prince Faisal and royal Councilors Khalid Gargoni and Jamal Hussain, only other Saudi officials present, as well as me. (Note: Aramco has reports that in Council discussions Faisal, Finance Minister Sulaiman and Commerce Minister Ali Reza supported Onassis agreement, whereas Royal Councilors Gargoni, Hussain and Sorur opposed it.)

4. King continued, in substance: as to interests of private companies, SA would fulfill obligations it had assumed; where no obligations lay, it would, in exercise of sovereign rights, act as it deemed best in national interest. He spoke with some heat and, I thought, irritation—not with me but rather, I surmise, because whole matter was distasteful to him.

5. I replied by urging that Aramco have full hearing to present its views, those of other interested American companies and broader considerations which had occasioned concern in high circles world oil industry. In ensuing brief discussion King again made his position clear. While he would regret have to pursue subject, door was always open to Aramco; he would not violate national obligations but, where there were none, he would not hesitate do anything advantageous SA; “this any country would do”; action had been complex.

6. I thanked King both for his assurance that US tankers were unaffected by agreement and for full exposition his position but added that I hoped, if tanker export should fall off materially, Aramco would not be blamed. King replied in substance that, if by will of God this loss occurred, Aramco would not be blamed; but if it were found to be Aramco’s fault, appropriate action would be taken promptly.

7. During later conversation with Gargoni and Hussain on other matters I suggested I could better report to Department re Onassis matter were I to have copy agreement. They promised “submit request to King and send his reply tomorrow”.

8. I shall discuss foregoing with Aramco officials and report reactions.⁵

Wadsworth

1. Repeated as telegram 331 to Jidda.
2. Not printed; it informed the Embassy that since the Department of State did not have the text of the Onassis agreement, it was not able to elaborate on the instructions it had already transmitted to the Ambassador. (780.022/4–2754)
3. This was the same as telegram 303 to Jidda, not printed, but see footnote 3, Document 340.
4. Despatch 384 from Jidda, May 17, transmitted a translation of an undated aide-mémoire received by the Embassy on May 12, confirming the King’s promise. The aide-mémoire also stated that Aramco tankers would not be affected but, according to the despatch, that statement had little significance since Aramco neither owned nor chartered tankers. (886A.2553/5–1754)
5. Telegram 165 from Dhahran, May 3, reported Aramco officials appreciated the Department of State position that the Onassis agreement was not in keeping with the Aramco concession agreement. (886A.2553/5–354)