Foreign Relations of the United States, 1955–1957, Suez Crisis, July 26–December 31, 1956, Volume XVI

577. Memorandum of Discussion at the 304th Meeting of the National Security Council, Washington, November 15, 1956, 9–10:55 a.m.¹

Washington, November 15, 1956, 9–10:55 a.m.

[Here follows a paragraph listing the participants at the meeting.]

1. Significant World Developments Affecting U.S. Security

[Here follows a report by Allen Dulles concerning the situation in Eastern Europe.]

Turning to the situation in the Near East, Mr. Dulles pointed out that we were threatened with power vacuums both in Egypt and in Syria when the British, French and Israeli forces are withdrawn. There would remain in Egypt some 90,000 Egyptian troops well equipped with modern hardware. Nasser was obviously much encouraged by recent developments, as is well illustrated by the conditions he is seeking to place on the stationing of UN forces in Egypt. The degree of his amenability to U.S. pressure will largely depend on how sure he believes he can be that the United States is in a position to block British and French or Soviet moves. So far, added Mr. Dulles, he had no clear evidence that the USSR has sent any volunteers to Egypt.

[Here follow Dulles’ comments on the situation in Syria and on the impact which recent events in the Near East and in Hungary had had upon Asia. Hoover then reported on several conclusions which the Department of State believed should be drawn from developments in the Near East and in Hungary. His first two conclusions dealt with the Hungarian situation.]

Secretary Hoover’s third point concerned the Near East. He expressed the opinion that the Soviet volunteers operation was primarily designed to prove to the world that it was the Soviets who were forcing the British and French out of the Canal Zone, and that it was the Soviets who were the real champions of the Arab states. In point of fact, the State Department had no hard information that any volunteers were entering Egypt on any considerable scale. Nevertheless, Secretary Hoover pointed out, at the moment British and French prestige and power was at absolute rock bottom, both in the Middle East and in Asia. Thanks to the British and French operations, Secretary Hoover predicted that Nasser would emerge stronger in the end than he had been when he started.

Secretary Wilson commented that there were two good and sufficient reasons why British and French prestige and power was slipping so fast. The first reason was their decision to send military forces into the Canal Zone. The second reason was, once having taken this step, they failed to make the grade and carry through after their initial strike. The British and French move was a very bad one from a military point of view. To Secretary Wilson’s two reasons for the collapse of British and French prestige, Secretary Hoover said he must add a third, namely, that British and French prestige was slipping rapidly in the Middle East even before the present crisis developed. He asked Mr. Allen Dulles whether he did not agree with this estimate of British and French prestige. Mr. Dulles replied that he would not give quite as high a rating to the position that Nasser would have at the end of the road as had Secretary Hoover, because of the complete defeat of the Egyptian Army by the Israelis and because of the miserable showing of the Egyptian Air Force. Admiral Radford agreed with Mr. Dulles’ point, and said that in the hostilities between Egypt and Israel, every Egyptian who was able to had run away. Admiral Radford added that he failed to see why so much emphasis was placed on the misdeeds of the British, French and Israelis, and so little emphasis given to Nasser’s long record of provocations.

The President said that he believed this distortion seemed perfectly natural in Arab eyes. Indeed, when one found Nehru apparently believing everything that Bulganin had said to him in explanation of Hungary, anything could happen. Bulganin’s arguments had been completely specious, but his reasoning had apparently been accepted by Nehru. Secretary Wilson observed that Nehru was capable of rationalizing anything. The President added that Nehru, of course, would never be able to forget his experience in British jails. Admiral Radford said he believed that Nehru had done as much as any single individual to build Nasser up. In no sense could Nehru be described as a genuine neutral.

Returning to his report, Secretary Hoover pointed out that another immediate problem was shaping up in the Gaza Strip. In explanation, he read from a telegram from our Embassy in Beirut.² This telegram pointed out how serious conditions were in the Strip, with the Israelis having a difficult time holding down the Arab refugees in that area. There were already casualties, and the danger of a severe uprising. As a result, the Ambassador in Lebanon was suggesting that we should not urge the Israelis to move their forces out of the Gaza Strip until UN forces were able to get in.

Admiral Radford said that of course the UN forces would not be large enough to maintain order in the Gaza Strip. The President expressed himself as being at a loss to understand why anybody wanted the Gaza Strip, in view of the fact that there wasn’t even any water in it.

At the conclusion of Secretary Hoover’s report, Mr. Jackson indicated that Dr. Flemming would report briefly on the oil situation in Europe.

Dr. Flemming said that after last week’s discussion of this problem in the National Security Council, he and Mr. Robert Anderson (former Deputy Secretary of Defense) had conferred at once with the presidents of the major oil companies. They had explained to these presidents our policies in this area, and the presidents had expressed themselves as in accord with our decisions. They favored at a later date pooling their shipping resources, which they regard as much more efficient than the individual action of each oil company, as was now the case.

Dr. Flemming added that in this discussion it had been agreed that the time had not yet come to put into operation the plans for supplying oil to Europe drawn up by the Middle East Emergency Committee. Nevertheless, Dr. Flemming recommended that the basic data on the oil situation available to the Committee should be brought up to date. There had been nothing new added in the last couple of weeks. This basic data, as to the problem of getting oil to Europe, could be obtained quietly and indirectly from the British and French through the agency of the Organization for European Economic Cooperation (OEEC). Once we have this additional basic data, Dr. Flemming indicated, we would be able to move very quickly when the time came to put the Middle East Emergency Committee plan into effect. It should also be possible to sound out the Saudi Arabians on their reaction to our effort to supply oil to Europe.

Secretary Hoover stated that it would be impossible for a few days to sound out the Saudi Arabian attitude, because King Saud was momentarily out of his country. Secretary Hoover then described a story printed in last night’s Washington Star, alleging that the United States Government was actually withholding oil supplies from Great Britain and France in order to force them to comply with the decisions of the United Nations. This erroneous story, said Secretary Hoover, would have the most unfortunate effect when it became known in Europe, as it certainly would. The European nations would all descend on us to blame us for their shortages. For this reason, if for no other, this Government, said Secretary Hoover, has got to move into the European oil situation in a short time, not later than a day or two.

The President said that he had thought we had already determined to let Venezuelan oil go to Europe. Secretary Hoover replied that while this was so, the problem was the availability of tankers to get the Venezuelan oil to Europe, and that, of course, if the companies attempted to pool their ships, they would run afoul of the anti-trust law. The President made a jocular reference to his “stiff-necked” Attorney General, and after Secretary Hoover had insisted that we would have to organize the pooling of tankers along the lines suggested by the Middle East Emergency Committee plan, the President again offered to make a public statement which might help the oil companies by declaring that their pooling activities were the result of a serious emergency situation.

The Attorney General reassured the President that the Department of Justice already had a plan of action in this situation which could be put into effect as soon as the State Department told him to do so. Dr. Flemming confirmed this statement, and added that the Department of Justice was showing admirable cooperation. He explained that he was really not much worried about the legal angle. The President observed that we must certainly use every legal recourse to meet the situation. Above all, we want to increase the flow of oil from the Gulf Coast to our own East Coast, so that more Venezuelan oil can go directly to Europe. Dr. Flemming informed the President that this was already being done.

There then ensued a discussion of the problem of pooling tankers. Secretary Humphrey elucidated the dilemma. If the oil companies pooled their tankers and this fact became known, the Arabs could be expected to cut off further oil supplies. Accordingly, we might be worse off than as though there had been no pooling. Despite the gain in efficiency by pooling the tankers, Secretary Humphrey therefore opposed such a move at the present time. Dr. Flemming expressed the opinion that if the oil companies did pool their tankers, it would be impossible to disguise the fact that such a move had been suggested by the U.S. Government.

The President said it was his conclusion that it was best to go along with the recommendations made by Dr. Flemming earlier in the discussion, namely, to get the basic data available to the Middle East Emergency Committee up to date, and to find out what the Saudi Arabians would do if they were to learn that we proposed to ship oil to Europe under the terms of the Middle East Emergency Committee plan.

Admiral Radford pointed out that the Russians were already supplying oil to Egypt and were in general moving into the situation there. He warned that we may have to move ourselves very promptly, not only in Egypt but in Syria.

Dr. Flemming inquired whether the consensus of the Council could be summed up in the following terms: First, that we would proceed to bring our basic data for the Middle East Emergency Committee up to date; and second, ask the State Department to sound out the Saudi Arabians on their reaction to our plans, before any action is taken by us.

The discussion closed with a new expression of great anxiety over Britain’s financial and economic situation from Secretary Humphrey.

The National Security Council:³

a. Noted and discussed an oral briefing by the Director of Central Intelligence on the subject, with specific reference to developments concerning Hungary and Poland; the situation in the Near East; the impact upon Asia of the foregoing events; and the situation in Korea.

b. Noted and discussed an oral report by the Acting Secretary of State regarding UN action on the Hungarian situation, and conclusions to be drawn as a result of recent events in the Near East.

c. Noted and discussed an oral report by the Director, Office of Defense Mobilization, on developments affecting the European oil supply position.

d. Noted the President’s authorization to the Department of State:

(1) To attempt to obtain recent data on the European oil supply position through the Organization for European Economic Cooperation (OEEC).

(2) To explore discreetly probable reaction of Arab oil-producing states if the United States were to put into operation the plan of action of the Middle East Emergency Committee.

Note: The action in d above, as approved by the President, subsequently transmitted to the Secretary of State for appropriate implementation.

[Here follow agenda items 2–6.]

S. Everett Gleason

1. Source: Eisenhower Library, Whitman File, NSC Records. Top Secret. Prepared by Gleason on November 16. The time of the meeting is from the record of the President’s Daily Appointments. (Ibid.)
2. Telegram 1200, November 13, not printed. (Department of State, Central Files, 684A.86/11–1356)
3. paragraphs a–d and the Note that follow constitute NSC Action No. 1632, approved by the President on November 19. (Department of State, S/S–NSC (Miscellaneous) Files: Lot 66 D 95, Records of Action by the National Security Council, 1956)