Foreign Relations of the United States, 1964–1968, Volume XXXIV, Energy Diplomacy and Global Issues

213. Telegram From the Embassy in Iran to the Department of State¹

Tehran, October 31, 1967, 0755Z.

1911. Iran Oil.

1. During intermission at Los Angeles symphony concert, Shah said he had just received report from PriMin Hoveyda to effect Consortium would fall $100 million dollars short of GOI expectations this year. He acknowledged expectations had soared during June Mideast crisis.

2. I suggested more valid viewpoint is that Iran will in fact receive this year $50 million more than Consortium had promised in agreement reached year ago. Shah acknowledged this is so.

3. I went on to point out that one cannot assume that other oil producing countries may not repeat foolish tactics against oil companies. I noted how poorly Iraq been doing as result of its excessive pressures and that situation there or in certain other countries could easily get worse.

4. Shah said Iraq Govt is totally irrational. It is taking poor Iraqi people, he said, down same catastrophic road as Mossadeq took Iran.

5. With reference to destruction of Suez refinery, Shah complained Western oil companies will increase their offtakes from Saudi Arabia and Kuwait which countries will then pay off UAR sums equivalent to amount of destruction.

6. Emphasizing Iran has been doing very well indeed, I urged Shah to continue to profit from policy of reasonableness.

Meyer

1. Source: National Archives and Records Administration, RG 59, Records of the Department of State, Central Files, 1967–69, PET 6 IRAN. Confidential. Repeated to London, Beirut, Paris, Jidda, and Kuwait.