Office of the Historian

894.6363/59: Telegram

The Ambassador in Japan (Grew) to the Secretary of State

Tokyo, March 29, 1934—noon.
[Received March 29—4 a.m.]

60. Referring to my No. 39, March 5, 2 p.m.

1.
The Petroleum Control Law has been approved by the Diet without change but the enforcing regulations have not yet been promulgated. It was stated in the lower House that the primary objectives of the bill were (a)—to regulate the imports of oil and thereby to promote the development of the domestic oil-refining industry and (b)—to secure an adequate supply of oil at all times.
2.
I have not yet made the representations envisaged by the Department’s 28, March 13, 7 p.m., because the local general manager of the Standard-Vacuum Oil Company which is primarily concerned recommended delay on the ground that the future administration of the law and not the terms of the law itself is the important factor in the situation and it seemed preferable from various points of view [Page 705] to await the actual passage of the legislation. I shall shortly make the desired representations.
3.
Local newspapers report that the Japanese Government is considering negotiations with the Netherlands Government for the purpose of regulating the trade between Japan and the Netherlands Indies on the barter system. From reports which the Embassy has special reason to believe are true it appears that the Japanese Government is considering the purchase by local and Manchurian refineries of a much larger proportion of crude oil from the Netherlands Indies than has been purchased in the past in order to offset the present heavy excess of exports to the Netherlands Indies. If some such arrangement is made the crude oil exports from the United States to Japan will be adversely affected.86
Grew
  1. The Ambassador in Japan, in his despatch No. 734, April 5, reported his call on April 2 at the Japanese Foreign Office, stating “The Vice Minister for Foreign Affairs said that he fully appreciated the position of the American oil companies; that he would look into the matter, and if at any time he should be in a position to give me information concerning the points that I had raised, he would be very glad to do so.” (894.6363/61)↩