800.6363/8–2444
The Secretary of State to President Roosevelt
The President: The undersigned, the Secretary of State, has the honor to lay before the President, with a view to its transmission to the Senate to receive the advice and consent of that body to ratification, if his judgment approve thereof, an agreement on petroleum between the Government of the United States of America and the Government of the United Kingdom of Great Britain and Northern Ireland, signed in Washington August 8, 1944.
The agreement expresses the mutual understanding of the two Governments with respect to certain principles governing international trade in petroleum. These principles have relation to (1) the making available of adequate petroleum supplies to the nationals of all peaceable countries at fair prices and on a nondiscriminatory basis, subject to such collective security arrangements as may be established; (2) the development of petroleum resources with a view to encouraging the sound economic advancement of producing countries; (3) equal opportunity in the acquisition of exploration and development rights in areas not now under concession; (4) respect for valid concession contracts and lawfully acquired rights; and (5) safeguarding the production and distribution of petroleum from restrictions inconsistent with the principles and purposes of the agreement.
The agreement is of an interim character, intended to be preliminary to the negotiation of an international agreement to which the governments of all producing and consuming countries interested in the [Page 125] international petroleum trade would become parties and which would establish a permanent International Petroleum Council. The agreement provides that the two Governments will formulate plans for an international conference to consider the negotiation of a multilateral petroleum agreement and that they will consult with other interested governments with a view to taking any necessary action to prepare for the proposed conference.
Meanwhile, for the discussing and resolving, on a cooperative interim basis, of certain problems of joint immediate interest to the two Governments, the agreement provides for the establishment of an International Petroleum Commission to be composed of eight members, four to be appointed by each Government. The Commission is charged with the responsibility of considering problems of mutual interest to the two Governments and their respective nationals. With a view to the equitable disposition of such problems the Commission is charged with (1) preparing long-term estimates of world demand for petroleum and suggesting the manner in which this estimated demand may best be satisfied by production equitably distributed among the various producing countries in accordance with the general principles of the agreement; (2) recommending broad policies for adoption by operating companies; (3) analyzing short-term problems of joint interest, wherever the nationals of either country have a significant interest, in connection with production, processing, transportation, and distribution of petroleum on a world-wide basis; and (4) making appropriate reports and recommendations to the two Governments.
It is provided in the agreement that the two Governments will seek the collaboration of the governments of other producing and consuming countries in the implementation of the principles underlying the agreement and will consult, as appropriate, with such governments in connection with activities undertaken on the basis of recommendations of the Commission established by the agreement.
The agreement consists of an Introductory Article and six numbered Articles. Article VI provides that the agreement shall enter into force upon a date to be agreed upon after each Government shall have notified the other of its readiness to bring the agreement into force and that the agreement shall continue in force until three months after notice of termination has been given by either Government or until it is superseded by a multilateral petroleum agreement of the character mentioned hereinbefore.
Respectfully submitted,