61. Minutes of the Secretary of State’s Staff Meeting1

[Omitted here is discussion unrelated to energy.]

[Mr. Robinson:] We also have in Saudi Arabia from Yamani a message2 that we ought to be moving on the prep-con idea, the linkage between commodities and oil. And he is pressing us for June 9, to do [Page 218] something before June 9, which is the date of the Dakar summit meeting of OPEC. And I have suggested a possible approach. There are some alternatives we may consider.

Secretary Kissinger: What is that?

Mr. Robinson: Well, that we have a ministerial level meeting in which we discuss the general issues.

Secretary Kissinger: Who is “we”?

Mr. Robinson: We—the ten participants in the prep-con.

Secretary Kissinger: No.

Mr. Robinson: Well, we have got to come up with—

Secretary Kissinger: We have got to do nothing. We will not be blackmailed. What are they going to do? We may be willing to indicate a willingness to have a meeting, to have another prep-con. But we will not gear our actions to the meetings of OPEC. Let the French do it. We will not.

Mr. Robinson: Well, I agree with that. But I think Yamani is expecting something from us.

Secretary Kissinger: Well, he can get something from us, but he cannot get a ministerial meeting before June 9.

Mr. Robinson: No, no. It is an agreement to move in a direction that it seems to me we should be thinking about.

Secretary Kissinger: That I am willing to do. But how would that differ from a prep-con?

Mr. Robinson: Well, there would be no attempt to debate or resolve any specific issues there. The only action item would be to set up working parties which would go off on parallel courses, one on energy and one on commodities.

Secretary Kissinger: Yes. But then what would happen to the prep-con?

Mr. Robinson: The prep-con would be merely preparatory to these two working party programs.

Secretary Kissinger: So it would be a prep-con.

Mr. Robinson: It would be a prep-con, yes.

Secretary Kissinger: Yes. But I think we ought to let the French call that anyway.

Mr. Robinson: I am not proposing we take any initiative. I am just saying I think we have got to have some response to Yamani to indicate we have not forgotten about our conversations here.3

[Page 219]

Secretary Kissinger: Yes. But we should be a little harder to push than the French.

Mr. Robinson: Right.

Mr. Sober: Yamani is using us, Mr. Secretary, to take a somewhat softer view on prices again. What he is saying is this is going to be impossible—

Secretary Kissinger: I know. But that is the tactic.

Mr. Sober: Yes, of course it is. But on the other hand, he feels—

Secretary Kissinger: I know what he feels. But we won’t let ourselves be driven like the French are.

Mr. Sober: No, sir. I was going to say something else. He feels that in the conversation he had on his last stop here, he was promised some ideas from us, and we haven’t given him any. I think probably Yamani is right in that.

Secretary Kissinger: That I agree with.

Mr. Sober: I might say on the oil question, too, the Shah is quoted as having said at the end of his stay in Venezuela4 that with inflation in the last eighteen months they have lost 30 percent of the value of their increase in price; and that looking at it through September also, both he and the Saudis now unfortunately seem to be zeroing in on the need for another price increase at the end of September.

Secretary Kissinger: We may be able to kid the Saudis, but we sure as hell can’t kid the Shah with a prep-con. He will ask for indexation.

Mr. Sober: He is on record with the Venezuelans as talking about the prep-con, but I don’t see any serious indication that he is concerned about it.

Secretary Kissinger: He isn’t looking for an excuse. If he doesn’t want to raise prices, he won’t raise them. And if he does, a prep-con isn’t going to stop him. The Saudis have no interest in raising prices one way or another. They have an interest in keeping out of trouble.

[Omitted here is discussion unrelated to energy.]

  1. Source: National Archives, RG 59, Transcripts of Secretary of State Kissinger’s Staff Meetings, Lot 78D443, Box 3, Secretary’s Staff Meetings. Secret. Kissinger presided over the meeting, which was attended by all the principal officers of the Department or their designated alternates. A table of contents and list of attendees are not printed.
  2. This and other references to Yamani are based on a conversation that Akins had with him on May 9, which the Embassy reported in telegram 3303 from Jidda, May 11. (National Archives, RG 59, Central Foreign Policy Files, D750165–0164)
  3. See Document 55.
  4. The Shah was in Venezuela May 5–9. A report on the highlights of his visit is in telegram 4908 from Caracas, May 10. (National Archives, RG 59, Central Foreign Policy Files, D750165–0023)