284. Telegram From the Embassy in Saudi Arabia to the Department of State1

329. Subject: Yamani Says Oil Boycott Cannot Be Lifted Tomorrow. Ref Jidda 308.2

Ahmad Zaki Yamani, Saudi Minister of Petroleum, has just told me (Jan 21, 1100 GMT) that the King and his Council had decided that the oil boycott on the United States should be lifted and production raised approximately to September level but that this decision could not be implemented until it was ratified by the Arab Oil Ministers. This ministerial meeting could not take place until after his (Yamani’s) return from Japan in early February. He said Hisham Nazir “obviously” would not have the stature to bring this off in Cairo.
I told him I was shocked; I had thought that the Arabs meeting in Cairo could take this decision tomorrow but if they could not, he should postpone or cancel his trip to Japan; this would be infinitely more important, not only to the U.S. but to Saudi Arabia, than explaining to the Japanese now why the production limitations were imposed in October. I said furthermore it was important that the world see that the Arabs were able to respond quickly and positively to events, as they responded negatively when the boycott was first imposed. The Arabs had seemed pleased with the U.S.; they had said this publicly. Not to lift the boycott now would be viewed very very hostilely in the United States and Europe, and probably even Japan.
Yamani replied that he was not suggesting a long delay; that it would be difficult to get the Oil Ministers assembled even if he cancelled his Japan trip which had been scheduled for a long time. (He offered a carrot on prices which I will describe in following telegram.)3
Comment: There is little doubt that there is a fight inside the SAG on who sets oil policy.4 Saqqaf rarely misses an occasion to stick the needle into Yamani. Others here are also annoyed at the world publicity given Yamani. Yamani is determined to be recognized in the West as being responsible for lifting the boycott and he doesn’t want the decision to be taken and announced while he is out of the country. Why he insists on going to Japan now is beyond me.
Haile Selassie is here on a state visit and it is hard to see officials, but I have asked urgently to see Omar Saqqaf and Prince Fahd today. I will tell them that we had heard explicit statements from both of them and from President Sadat that the boycott would be lifted when the disengagement agreement was reached. We took them at their word and we expected this to be done. The Arabs must be able to show that they can react quickly and favorably to actions they approve of. I will not say directly, but I will also intimate that what is also at stake is the reputation of the King; that is, who makes oil policy, His Majesty and his political advisors or Yamani, whom they frequently characterize as a “technician”?
There is a danger that Yamani will be hurt in any inter-government fight but I believe this is a risk we have to take. If the boycott is not lifted now, there will be some further excuse not to lift it next week, e.g. let’s wait until the Israelis are actually back to Mitla, or the Egyptian oil fields are given back, or phase two begins. If Yamani is overruled, I will be most solicitous in thanking him for having changed his mind.
I probably won’t be able to see Saqqaf or Fahd before 7:00 this evening (1600 GMT). If you do not approve of the approach I’ve outlined in paragraph 5 above, please let me know.
  1. Source: National Archives, Nixon Presidential Materials, NSC Files, Kissinger Office Files, Box 139, Country Files, Middle East, Saudi Arabia, Dec 73–Feb 74. Secret; Flash; Nodis; Cherokee.
  2. In telegram 308 from Jidda, January 20, Saqqaf informed Akins that Faisal had agreed the boycott should be lifted immediately with the understanding that it would be reimposed if further moves toward permanent peace were not made, that Saudi Arabia would take this action regardless of the position taken by other oil producers, and that written instructions would go to the Saudi delegate at the Cairo meeting of Oil Ministers on January 22. (Ibid.)
  3. Yamani told Akins that if the United States launched a strong diplomatic offensive with other OPEC producers, he would give it his “full support” upon his return from Tokyo in February. “In fact he said he would ‘join’ us in such démarches, but I assume he did not mean literally a joint approach.” Yamani thought the price of oil could be brought down from $7 to $5 per barrel with strong démarches made by consumers. (Telegram 330 from Jidda, January 21; ibid., Box 631, Country Files, Saudi Arabia, Vol. V)
  4. According to telegram 331 from Jidda, January 21, Saqqaf and Fahd favored an immediate lifting of the boycott, while Yamani and Prince Musa’ad, Minister of Finance, agreed that the boycott should be lifted but insisted that Saudi Arabia could not act alone, that other Arabs had to be consulted. King Faisal had agreed with Yamani, indicating that for the time being, Yamani had won the power struggle over oil policy. (Ibid., Nixon Presidential Materials, NSC Files, Kissinger Office Files, Box 139, Country Files, Middle East, Saudi Arabia, Dec 73–Feb 74)