393.115 Standard Vacuum Oil Co./281: Telegram
The Consul at Nanking (Paxton) to the Secretary of State
[Received September 10—3:15 a.m.]
90. Reference Shanghai’s 868, September 4, 3 p.m., concerning Japanese interference with American shipments from Shanghai to the hinterland.
[Page 538]The local manager of the Standard Oil Company states that the Japanese Oil Association in Shanghai appears seriously to underestimate the demand of the local market (in his opinion, it may be necessary in order to limit imports by non-Japanese firms). He estimates that over 80,000 gallons of gasoline alone can be absorbed in this market for civilian use exclusive of the requirements of the Japanese army. The Asiatic Petroleum Company in Nanking has received no permits to import any stocks whatever under the regulations enforced in August, possibly in part owing to anti-British feeling, and is now completely out of gasoline. The Texas Company is running short of stocks and the Standard Vacuum Oil Company has supplies for normal use for only one and a half months. The latter is attempting to restrict sales to old customers in normal amounts only, but this is proving very difficult.
In August the Standard Oil Company has been able to obtain permits, in the name of its Japanese agents, to bring from Shanghai only 12 carloads (4 each of gasoline and kerosene and 2 each of candle and diesel oil) which constitute less than half its normal imports.
The Japanese have tightened inspection requirements at all city gates to the point where movements of goods to areas outside Nanking are virtually impossible without Japanese consent. The informant remarked that it seemed to him that if any oil stocks reached the guerrillas they were of Japanese origin, either seized from the Chinese purchasers or, according to persistent rumors, in some instances purchased by arrangement with the knowledge of the Japanese merchants.
Sent to the Department. Repeated to Chungking, Peiping and Shanghai. By mail to Tokyo.