144. Telegram From the Deputy Secretary of State (Irwin) to the Department of State1

20276/Depto 15. Subj: OECD Oil Committee High Level Group Meeting.

Deputy Secretary Irwin October 24 gave full review in energy field to OECD Oil Committee High Level Group.2 He told them USG plans move on several fronts in an effort to begin solving our energy problems early in 1973. Many actions we propose can and will be taken by US acting alone; others must be taken jointly. We consider energy problem so grave that purely national solutions of its many aspects are inadequate and inadvisable—even for US—and a cooperative approach to problem in next two decades is essential.
Irwin described Yamani offer;3 said it undoubtedly has attractions for USG but acceptance of full proposals would be counter to current US practice and policies. US wishes to encourage Saudi investment in US and will inevitably accept more Saudi oil. It does not wish to offer Saudi Arabia, or Iran, which had made similar offer two years ago, preferred positions in US market, although we had not rejected the proposal. US had noted that several countries had suggested similar deals with Saudis and other producers. This caused us concern. For any major consumer to try to secure for itself large segment of available oil, to detriment of other consumers, could launch world on competition cycle for oil which we had long sought to avoid. We had no doubt that we would have some success in such a competition for oil, in that we could secure adequate supplies for ourselves, but we would pay more for that than we might otherwise need, other consumers would be hurt and strains would be placed on our relations with our friends. We would strongly prefer a cooperative approach to the energy problems and we would like to hear expressions from Europeans and Japanese on the subject.
Akins had had long meetings with Spaak and Haferkamp in Brussels October 23; told them of Saudi offer (which obviously disturbed them considerably); said we might be forced to enter into relationship with Saudi Arabia and Iran if other countries persisted in trying to sew up supplies for themselves. These conversations were discussed with all Community energy officials (including UK) who met in Brussels later that afternoon and they decided there on common approach.
At OECD meeting October 24 Spaak spoke for entire Community—and he [and] Haferkamp noted at dinner meeting evening of Oct 24 that this had been an important day in Community history and in Community relations with US. US had urged cooperative approach to energy problems and Community had responded for first time with one voice. Spaak said Community was pleased with US frankness and honesty; was impressed by Irwin’s arguments and concurred with his conclusion that problem should be faced jointly.
British and Germans gave Spaak strong support and Italians urged quick action to meet problems. High Level Group agreed appoint working group to make quick résumé of energy problems to finish work before March, with High Level Group meeting sometime in February to review conclusions and study means of meeting methods of cooperative actions to meet problem.
At dinner meeting with Haferkamp and Spaak we reviewed presentations; Haferkamp reviewed Community policy. Both Spaak and Haferkamp were elated at first formulation of Community energy policy and also pleased with decision to move in cooperation with US to solve problems. Haferkamp said these two steps were “strong medicine and must be taken in small doses” but urged frequent meetings and consultations even before energy résumé completed. He agreed the Community would have to develop specific action proposals and would start working on this immediately.
From our point of view meetings successful. European analysis of energy problem is essentially same as ours—and clearly influenced by our work—and Europeans for first time have jointly expressed their desire to cooperate with us on broad front to solve energy problems. They were disturbed by possibility of US sewing up energy supplies for itself and they recognize that such an approach would damage them more than it would us; they were pleased and impressed with our initiatives. The Japanese were non-committal. We are more inclined to view this as usual Japanese reluctance to commit themselves rather than rejection of concept of a cooperative approach to problem. Spaak suggested joint US-Community approach to Japanese to convince them of usefulness of cooperation and dangers of unilateral attempts to cover own energy needs.4
Full account of meetings follows by airgram.5
  1. Source: National Archives, RG 59, Central Files 1970–73, PET 3 OECD. Confidential.
  2. The text of Irwin’s statement to the High Level Group is in telegram 213860 to USOECD, November 24. (Ibid.)
  3. See Document 140.
  4. In telegram 217867 to Tokyo, December 1, the Ambassador was requested “to call on highest appropriate FonOff official to emphasize importance USG places on Japanese participation in cooperative efforts to insure that future world oil supplies are available in adequate quantities and at reasonable prices.” (National Archives, RG 59, Central Files 1970–73, PET 3 OECD)
  5. A full account of the meeting is in the official report, entitled “OECD HLG and Oil Committee Meetings, Paris—October 25–26.” (Ibid.)