Foreign Relations of the United States, 1969–1976, Volume XXXVI, Energy Crisis, 1969–1974

214. Memorandum of Conversation of Washington Special Actions Group Meeting¹

Washington, October 14, 1973, 9:16–11 a.m.

• PARTICIPANTS
  • Secretary of State Henry A. Kissinger, Chairman, WSAG
  • Deputy Secretary of State, Kenneth Rush
  • Assistant Secretary of State for Near Eastern and South Asian Affairs, Joseph Sisco
  • Ambassador Robert McCloskey
  • Secretary of Defense, James
  • Deputy Secretary of Defense, William Clements
  • Chairman, Joint Chiefs of Staff, Admiral Thomas H. Moorer
  • Director, Central Intelligence, William Colby
  • Assistant to the President for Energy, Governor John Love
  • Consultant to the President for Energy, Charles DiBona
  • Assistant to the President, General Alexander M. Haig, Jr.
  • Deputy Assistant to the President for National Security Affairs, Major General Brent Scowcroft
  • Commander Jonathan T. Howe, NSC Staff

• SUBJECT
  • WSAG Meeting—Middle East

[Omitted here is discussion unrelated to oil.]

[Dr. Kissinger:] What do we do if the oil is cut off? What kinds of problems will we have?

[Governor Love distributed a draft contingency paper on the oil problem.] (Tab B)²

Governor Love: There are a number of ways to cut off the supply. First of all, we have to consider direct imports and then indirect imports.

Dr. Kissinger: What assumptions are you making when you talk about a total cutoff?

Governor Love: We are not talking about Iranian oil, but we are assuming the rest of the Persian Gulf states, Libya and Algeria join in the cutoff. (Reading from paper), we figure a 100,000 barrels a day indirect with an anticipated growth all the way up to 500,000. Over a six-month period we might be able to save the following amounts. We would be able to surge our own oil production and get 100,000 to 200,000 barrels a day,³ From coal we could get 200,000 to 300,000 more barrels a day but this would take a major effort which has legal constraints. By cutting demand we could save from 150,000 to 300,000 barrels a day. By changing the speed limit we could get another 100,000 barrels a day and reduce the level further by gasoline tax. That would require drastic action and we would have to take immediate and affirmative action. (Explains summary table of paper.)

Dr. Kissinger: What is low-low and high-high (referring to table)?

Mr. DiBona: The principal factor is weather—that is whether it is cold or hot.

Dr. Kissinger: But what does the phrase low-low mean?

Mr. DiBona: That means low estimate, low demand.

Secretary Schlesinger: How much could the Iranians increase? Five-and-a-half to eight million?

Mr. DiBona: Our calculations are for this winter.

Governor Love: Iran could perhaps get 200,000 barrels a day more but they have already kicked it up.

Dr. Kissinger: Do you assume a cutoff to the US or Europe?

Governor Love: If Japan and Europe are thrown into the balance, that gives it a different dimension. We have looked at the effect on import levels. It is not realistic to consider the US alone. We also have to look at the effect of the US emergency surplus. We have limited refinery capacity and that is why we have to import.

Secretary Rush: Do we import?

Dr. Kissinger: If it happens, it will happen next week. We are going to need a plan. It should consider a cutoff in the US and a cutoff to Japan and Europe as well.

Governor Love: To do so, we also have to consider consultations on the Hill, putting the President on TV, and the timing of what we do now. We have to be ready.

Dr. Kissinger: We don’t want to push the button now and cause a panic. We need to have the program ready for the day when they do it.

Governor Love: Faisal is talking about a cut of five percent a month.

Dr. Kissinger: What about the long term? Suppose the Egyptians are badly defeated. I don’t think they will be, but it is not beyond the realm of the possible. We might lose all outlets and get cut off. What if they limit production over the long term and we can’t handle it with diplomacy and other pressures?

Governor Love: We can identify areas to increase supply and limit demand but we would have to make some statutory changes. If it happened now, by Tuesday or Wednesday⁴ I would expect the President to say and do something.

Secretary Clements: I think the prediction of picking up 100,000 barrels a day in the southwest is questionable. They think they are at capacity now. It is also questionable whether we should count on Elk Hills. It is not a matter of just turning the tap on. We may get there in time but it is not a significant amount. This is a mega problem in which we must measure in millions.

Governor Love: They have two million.

Director Colby: Our estimate on how sharply the oil would be cut has to be related to the Arab position on the ground. If the Israelis move slower, then the Arabs should be equally slower in their reaction.

Secretary Schlesinger: On timing we must weigh the advantage of getting something out on the problem. If it is indicated this will happen, we will want to consider the deterrent impact.

Dr. Kissinger: So far no one has threatened us, but we have no program.

Governor Love: We could announce something quickly.

Secretary Kissinger: I wouldn’t provoke it or threaten them. An oil cutoff was not mentioned in any of the conversations I have had in the last three weeks. All I have received are hysterical calls from oil companies. The Saudis have been better than any. We have good commercial relations. Some idiot says we shouldn’t have said that but I don’t want to challenge the Arabs to a test of their manhood.

Secretary Rush: When we resupply to Israel at that point we will have a problem.

Secretary Schlesinger: The Saudis don’t care about the Syrians. The Egyptians could urge the Saudis to be prudent.

Secretary Clements: It will cause restrictions on the domestic economy.

Governor Love: We would have to make some shifts and close down some factories.

Secretary Clements: There are no other short-term answers.

Dr. Kissinger: I have no preconceived ideas on this.

Secretary Rush: The industrial aspect bears watching.

Dr. Kissinger: We need a task force to begin today to study this problem. John (to Love) and Bill (to Clements) will you work with State on this.

Secretary Sisco: We can get George Benson and one member of the NSC staff.

Dr. Kissinger: We need concrete programs. We need to pin point this for the President. Here are the two or three major things that you can do. He has got to know what he can do if the oil is cut off. We also need to know what to do with regard to Europe and Japan.⁵

Governor Love: The cut in Europe will be 75 percent and Japan gets 50 percent of its oil from Arab countries.

Secretary Schlesinger: They have sixty days of stocks.

Dr. Kissinger: How much do we have?

Secretary Clements: I don’t know.

Dr. Kissinger: Is it sixty days of key things or of everything.

Mr. DiBona: Europe has sixty days of everything.

Dr. Kissinger: And the U.S.?

Mr. DiBona: We have a few weeks of total consumption or 200 days of European consumption.

Secretary Rush: There is a great difference between the two.

Governor Love: In a short time there would be shortages in everything—perhaps a month.

Dr. Kissinger: Let’s have a meeting tomorrow at 9:00 or 11:00 and get a detailed program on the oil cutoff. Would we share with the Europeans?

Mr. DiBona: It is not clear that they can cut off the US. We are having trouble, for example, following Libyan oil production.

Dr. Kissinger: Would they have to cut off all oil production?

Secretary Schlesinger: That is right, to be effective.

Dr. Kissinger: (to Secretary Rush): Can we have another group at State and Defense look at what would be the political impact?

Secretary Schlesinger: If we Americanize El Al the Arabs will note it.

Dr. Kissinger: It would be tough enough to go through this for a worthy cause. We should make approaches all over the world. We will need a working group. (To Scowcroft) Is Sonnenfeldt working?

General Scowcroft: Yes.

Dr. Kissinger: We will get Sonnenfeldt working on this with Stoessel and we will need a DOD representative as well. So when we meet tomorrow we will need two things:

• —a technical program on what the President has to do, and secondly,
• —a political program on what we face with regard to Western Europe and Japan.

Secretary Sisco: I will try my hand at a Presidential statement.⁶

Dr. Kissinger: Let’s see the program first.

Secretary Rush: The world can’t live with it.

Dr. Kissinger: Let’s not talk about consequences. We don’t want to make it happen. We should be low key.

Mr. Dibona: Who should get involved with regard to the legal questions?

Dr. Kissinger: Just tell us what we need to get done.

Secretary Schlesinger: The mood of the House is not very forthcoming. The House is as opposed as the Senate, and it extends from “doves” to “hawks.”

Governor Love: There will be a hearing before the Albert Committee.⁷ They will open it for 12 months for 160,000 barrels a day, if we can guarantee that will take care of the problem.

Secretary Sisco: I detect the opposite view. Some 203 House members signed the petition.⁸ Because of the Israeli aspect, there is a certain ambivalence.

Dr. Kissinger: We don’t want to provoke it. If there is a fait accompli, we want to know what to do.

Governor Love: We will have to move on an allocation program.

Dr. Kissinger: Consider that on Tuesday or Wednesday or Thursday the Arabs announce a cutoff. What do we do? The President has to know what he would do and announce it. If Europe and Japan are included, we have to know what we can do in concert.

Secretary Clements: I agree, it is a problem both internationally and domestically.

Dr. Kissinger: Yes, we would move with contacts that day or the next day. We need to get a list of what our needs would be and our alternatives if we can’t get oil. The question is whether we think it through now or then. Assuming an oil cutoff, John (to Love), I would like you to chart it. Perhaps we can get together later today. We will get together later today.

[Governor Love and Mr. DiBona left the meeting.]

[Omitted here is discussion unrelated to oil.]

1. Source: National Archives, Nixon Presidential Materials, NSC Files, NSC Institutional Files (H-Files), Box H–117, Washington Special Action Group, WSAG Minutes (Originals) 7/27/72–9/20/73. Top Secret; Sensitive. The meeting occurred in the White House Situation Room. All brackets are in the original with the exception of those that indicate omitted material. Printed in full in Foreign Relations, 1969–1976, volume XXV, Arab-Israeli Crisis and War, 1973, Document 181.
2. Tab B is attached but not printed. Among the documents at Tab B is an October 14 memorandum from Love to Kissinger on an Emergency Oil Contingency Program, requested by Kissinger at the October 7 WSAG meeting summarized in Document 209. Love assumed a supply shortfall of 10 to 12 percent of the total U.S. consumption, that no U.S. non-Arab oil imports would be diverted to compensate for European and Japanese losses, and that there was not one single action the United States could take to meet the effects of a cutoff. Love then suggested a wide array of feasible options, and noted he was taking steps to create several standby task forces in various agencies to implement the full contingency program.
3. and also get 100,000 barrels per day our Elk Hills naval reserve. [Footnote in the original.]
4. October 16 or 17.
5. An interagency group composed of representatives from the Departments of State and Defense, the CIA, and NSC, submitted a paper entitled “Actions in the Event of an Arab Oil Embargo Against the United States, Western Europe and Japan,” to Kissinger on October 14. The paper concluded that the United States had two principal means of getting the Europeans and Japanese to cooperate in united action: 1) to make clear a willingness to share any shortfalls, and if they did not cooperate, then “make clear our determination to use all our power to scramble for available oil,” and 2) to convince Europeans that the political cost to them of a split in the alliance would be “more serious to their national interests than the damage they may perceive united action would do to their Mid-East or Eastern European policies.” (National Archives, RG 59, Central Files 1970–73, PET 17–2 EUR)
6. A draft Presidential statement is ibid., Nixon Presidential Materials, NSC Files, NSC Institutional Files (H-Files), Box H–93, Washington Special Action Group Meetings, WSAG Meeting Middle East 10/14/73.
7. Speaker of the House Albert was Chairman of the Democratic Steering and Policy Committee.
8. Not further identified.