Foreign Relations of the United States, 1964–1968, Volume XXII, Iran

261. Telegram From the Department of State to the Embassy in Iran¹

Washington, March 5, 1968, 0125Z.

124570. Eyes Only for the Ambassador. Ansary called for a private meeting with Rostow as soon as he arrived back from his meeting with the Shah in St. Moritz. Ansary appeared very concerned and made following points with great emphasis.

1. He said that according to Iranian sources it appeared that some of our people had contacted former Prime Minister Amini. More importantly, he passed on story to effect that Ambassador Meyer had said to General Amini’s widow that he would like to meet with former Prime Minister Amini and suggested meeting at dinner at her house.

2. Ansary noted that there had been some student unrest in Tehran recently and passed on the report that some of our people had been in contact with the students involved.

3. Ambassador stated that Rostow’s position on closeness of US-Iranian relations had been accepted by Shah but that Shah noted that some people appeared to take a slightly different view of this relationship and had been less than neutral in median line dispute, Gulf problems and consortium discussions. Shah had pointed out that his government was after all a nationalistic one and it would be disastrous both for himself personally and for US Government’s interests in area if he were to give up Iranian claims to $2 billion worth of oil in dispute in median line area. Ultra Nationalists, people out of sympathy with his regime, and Communists would exploit such concessions on his part to detriment of both his and our interests.

4. As example of types of stories circulating in Tehran which tended to erode basic US-Iranian understanding was report Ansary had heard from two sources which indicated that US Ambassador had said that he thought cancellation of Shah’s visit to Saudi Arabia was a mistake. Ansary added that stories to this effect would provoke an emotional reaction both from Shah and from his immediate entourage.

5. Ansary stressed that we should not underestimate the seriousness of the Bahrein problem, and that he was most concerned by reports that Bahrein and Qatar were contemplating becoming members of Gulf federation.

6. Ansary reported that Shah was extremely disturbed by status of consortium negotiations and he felt that some movement on part of companies was badly needed. Shah had pointed out to him that Iraqis had taken away large part of consortium concession in Iraq but consortium was still producing oil in Iraq at relatively satisfactory rate.

7. On arms sales negotiations, Ansary said Shah was extremely disturbed because after several months of negotiations no draft agreement had been produced. He pointed out to Ansary that Iraq and Saudi Arabia were buying arms elsewhere and that his reasonable requests for purchases from the US had not yet been honored. He wished to do business with us and he hoped that he would be able to continue to do so, but there would come a time when his patience would be exhausted.

8. In conclusion, Ansary stressed fact that in a period of increased nervousness in Tehran when there were even unfounded rumors of a change in government, it would be wise for US diplomatic establishment to proceed cautiously as suspicions and fears were heightened.

9. Rostow made appropriate responses to all points covered.

10. Rostow expects see Ansary again March 6 and would appreciate comment on above beforehand.

Rusk

1. Source: Department of State, Central Files, POL IRAN-U.S.. Secret; Priority; Nodis. Drafted by Grey on March 4, cleared by Eliot, and approved by Under Secretary Rostow.