888.2553/1–452: Telegram

No. 139
The Ambassador in Iran (Henderson) to the Department of State 1


2462. 1. Prud’homme and Rieber of Int Bank discussed with Richards and me this morn problems created by Mosadeq’s ltr to Garner of Jan 3 (Embtel 2448 Jan 3).2 They said their tentative decision to leave Iran was based in part on hints which they had recd from Pirnia, Under Secy MinFin, who was acting as liaison between them and PriMin, to effect that PriMin wld not be displeased if they wld leave Iran until questions raised in ltr to Garner had been clarified. Pirnia had also told them PriMin did not wish them in meantime to make trip to South Persia. Prud’homme and Rieber thought it preferable that Garner make no reply to Mosadeq’s ltr until they cld have chance discuss with Garner Iran sitn as they saw it.

2. I told them that I had obtained impression from my conv with PriMin yesterday eve that he was commencing to hope they wld not leave country just now and that his ltr to Garner wld not lead to breaking off of negots with bank. I said PriMin seemed to realize that if bank should withdraw from picture there was little hope [Page 302] that in foreseeable future Iran oil operations cld be restored. After some discussion all of us agreed that it might be good idea for me see PriMin at once and to suggest that so long as Prud’homme and Rieber were in Iran they shld make trip to Abadan and oil field before return to US. I went immed to PriMin and talked with him along these lines. PriMin said he wld like to talk direct with Prud’homme and Rieber without any third person being present. He did not fully trust any one in his entourage. He also said he wld approve trip of Prud’homme and Rieber to Abadan and oil fields and suggested they write him ltr containing request for appt and proposal they take trips south. He said he wld be glad to see them at 10 o’clock morn Jan 5 provided they wld write suggested ltr.

3. I have just had another talk with Prud’homme and Rieber, who have agreed to Mosadeq’s suggestions. Prud’homme is sending ltr this afternoon, text of which reads as fols:

“I wish to acknowledge receipt of ur ltr of Jan 3, 1952 addressed to Mr. Garner, the contents of which have been forwarded to him by telegraph.

I am inclined to believe from exam of ur ltr that it cannot be answered until a considerable amt of study by members and staff of bank has been devoted to some of the questions and comments contained in it, and that therefore some time will elapse before reply can be sent to you. It wld seem to me that it might serve to expedite discussions between bank and Govt of Iran if in meantime Mr. Rieber and I shld visit operations at Abadan and in field for purpose of looking over it so that we may prepare report to bank with respect to it.

In this connection I also wld suggest that it might be useful for Mr. Rieber and myself to have chat with you at ur earliest convenience.”

4. Altho Mosadeq has tentatively agreed that Prud’homme and Rieber shld visit South Persia, Dept will recall he sometimes changes his mind and we cannot therefore be sure until after their conv with him Jan 5 that trip will materialize.3

5. I sincerely hope bank will not have any objections to course of action which its reps and Emb have decided most desirable. As I indicated in mytel yesterday, Iran is sick country and PriMin is one of its most sick leaders. We cannot consider therefore either [Page 303] Iran or him as normal and shld exercise maximum amt patience even in face of considerable provocation.

6. Have read this tel and Embtel 2448 Jan 3 to Prud’homme and Rieber who said they hope contents cld be conveyed to Garner.

In no circumstances is anyone other than Dept, except Garner, to know of Emb’s connection with these negots.

  1. Repeated to London.
  2. Mosadeq’s letter, Jan. 3, was sent to the Department in telegram 2445 from Tehran on Jan. 3. (888.2553/1–352) It raised eight separate points in the IBRD proposal on which Mosadeq sought clarification. In telegram 2448 Ambassador Henderson reported that Prime Minister Mosadeq was especially suspicious of Garner’s suggestion that part of the proceeds derived from the sale of Iranian oil should go to the bulk buyer, whom Mosadeq assumed to be the British Government. If this were the case, Mosadeq said, this suggestion would be unacceptable because he assumed the IBRD would merely be acting as a tool of the British. The Prime Minister also disclosed that Prud’homme and Rieber, as a result of his letter, were planning on leaving Iran. Henderson offered to see the two IBRD representatives and to urge them to delay their departure in view of Mosadeq’s stated desire to continue negotiations. Moreover, Henderson recommended that the Department suggest to the IBRD that it not recall its representatives, and that it instruct them to try to find some basis for continuing the Tehran discussions. (888.2553/1–352)
  3. In telegram 2479, Jan. 5, Henderson reported that Prud’homme and Rieber had had a cordial conversation with Mosadeq, who was anxious for the two IBRD representatives to visit Abadan prior to their projected departure from Tehran on Jan. 13 to discuss the situation with Garner. Prud’homme also made it clear to Mosadeq that he could not expect an immediate reply from Garner to his letter dated Jan. 3. Mosadeq, for his part, emphasized that, as part of an agreement, he had to have dollars in the form of advances secured on oil from the IBRD or aid from the U.S. Government. (888.2553/1–552)