Foreign Relations of the United States, 1952–1954, Iran, 1951–1954, Volume X

888.2553/11–953: Telegram

No. 383
The Secretary of State to the Embassy in Iran¹

secret
niact

Washington, November 9, 1953—7:11 p.m.

1153. For Ambassador from Hoover. My analysis re Iran memorandum situation in London follows, all or any part of which in your discretion you may communicate to GOI:

1. Am convinced that Iranian memorandum and its submission to HMG was absolutely best thing that has happened so far in oil situation from Iranian viewpoint. Fact that Iran took aggressive initiative was of great psychological importance. While HMG appeared highly shocked at first paragraph and in effect could not take cognizance of it, nevertheless it is having most salutary effect on their thinking.

2. Am convinced HMG actually have realistic view possibility AIOC returning to Iran which coincides ours, but HMG has political problem re prestige in general and AIOC in particular; and while HMG privately accepts our assessment this situation in Iran, they publicly must evaluate for themselves.

3. Have been assured here we will support GOI in opposing (a) more than 50 percent British participation, (b) more than minority position for AIOC and (c) any effort of AIOC to regain title prior to setting up consortium. However US wishes if possible avoid appearance of forcing American participation at expense of British interests.

4. I personally convinced that resumption of relations should precede oil discussions, as agreement on principles is such complex matter that doubtful if any agreement could be reached without direct contact. However will be much easier to handle since HMG now knows GOI unmistakable position re AIOC.

For London: Please advise HMG we hope they will agree Henderson can approach Iranians along lines suggested urtel 57 rptd Department 2002. If HMG agrees, inform Henderson niact.²

Dulles

1. Repeated to London. Drafted by Hoover and approved by Byroade.

2. The Embassy in London responded on Nov. 9, reporting that the British wanted Henderson, in his conversation with Foreign Minister Entezam, to take the following line: 1) give Entezam the explanation about the Iranian memorandum contained in telegram 2002 (supra); 2) say that Eden was prepared to send Zahedi a message along the lines of paragraph 4, telegram 1969 (Document 381). Henderson was also to say that Eden was ready to make a later statement in the House of Commons on the same lines, if the response was favorable to the message contained in telegram 1969. In conclusion, the Embassy wanted Henderson only to sound out Entezam on the British proposal to see if the Iranians would be receptive. (Telegram 2026; 888.2553/11–953)

   Henderson reported on Nov. 10 that he had seen the Foreign Minister and followed suggestions 1 and 2 in telegram 2026 from London. Entezam replied that he wished to make no comments until he had seen the Shah and the Prime Minister. Later that day, Henderson had an audience with the Shah, who had just spoken with Entezam. The Shah proceeded to ask Henderson about the details of the British offer. The Shah agreed with the logic of the British proposal to resume diplomatic relations prior to negotiating an oil settlement, but he was worried about the political reaction in Iran. The Shah pledged, however, to try to reach a decision in concert with the Foreign and Prime Ministers as to what to do as soon as possible. (Telegram 1076; 888.2553/11–1053)