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

264. Circular Telegram From the Department of State to Certain Posts¹

Washington, August 25, 1967, 0343Z.

26879. Ref: State 26123; Dhahran 146.²

1. Briefing top oil company executives of Aramco, four Aramco parents, Gulf, and Continental held August 24 at request of companies.³ Meeting chaired by Rostow and attended by Harriman, Battle, Solomon, Davies, and representatives of USIA and Interior.

2. Rostow gave executives our views on current situation in Middle East, our efforts find constructive solution Arab-Israel problem, our attempts help moderate Arabs withstand pressure from radicals, and our thoughts on developments for near future.⁴

3. Companies made specific proposal that public USG statement be made before new Arab foreign ministers conference and summit which would provide reassurance to moderate Arab states. Executives stressed this “key moment” to make such statement. Rostow agreed give proposal full consideration. Battle pointed out many such statements drafted but it is exceedingly difficult to construct one which satisfies one side without offending other. Davies discussed aide-mémoire (State 26123)⁵ to be presented Arab foreign ministers before August 26 meeting in Khartoum.

4. Executives asked how companies could help in current situation.⁶ Rostow and Battle emphasized need for support in current difficulties with Congress, especially in fields foreign aid and arms supply.

5. FYI. We are considering merits backgrounder in depth for selected U.S. correspondents prior summit to provide some ammunition for moderates. End FYI.

Rusk

1. Source: National Archives and Records Administration, RG 59, Records of the Department of State, Central Files, 1967–69, PET 17–1 ARAB. Confidential. Drafted by D. Newton (NEA/ARP) on August 24; cleared by L. Dinsmore (NEA/ARP), Davies, Battle, and Kelly (S/S); and approved by Rostow. Sent to Algiers, Amman, Beirut, Jidda, Kuwait, Rabat, Tehran, Tel Aviv, Tripoli, Tunis, Cairo, Dhahran, and Jerusalem, and repeated to London, Paris, and USUN.
2. Neither printed. (Ibid., POL 7 SUDAN and PET 17–1 ARAB, respectively)
3. In attendance were G.L. Parkhurst (Standard-California), G.T. Piercy (Standard-New Jersey), H. Cash (Texaco), H.C. Moses (Mobil), I.G. Davis (Gulf), J.S. Royds (Continental Oil), L.F. Hills (Aramco), and J.W. Pendleton (Aramco). An August 23 briefing memorandum for Rostow reads: “The companies are worried over the positions of the Arab moderates and fear that the latter may be unable to stem the tide of radical Arab policies.” (Memorandum from Battle to Eugene Rostow, August 23; ibid., PET 6 US) On August 9 Akins summarized the U.S. position: “Our vulnerability to Arab pressure lies in the possibility of nationalization of our oil interests in the Arab world. This would mean a loss of several billion dollars in direct investment, of thirty years effort in building an industry and of at least a billion dollars annually toward our balance of payments—the direct damage to the United Kingdom would be even more severe.” (Memorandum from Akins to Bergsten (OMA), August 9; Department of State, E Files: Lot 71 D 84, FSV Facilitative Service—1967)
4. The briefing memorandum prepared by Battle for Rostow summed up the problem of dealing with the Arab states: “They are now forced to consider accepting conditions of life which have the effect of declaring to the whole world their impotence and their ineptitude. The pain caused by embarrassment over their exposure is still sensitive, and they seek alternatives which would eliminate their discomfiture. The signs are all too few that Arabs will see the light as we see it or will reverse their stated policies.” The briefing memorandum also includes an analysis of the situation in each of the Arab states. (National Archives and Records Administration, RG 59, Records of the Department of State, Central Files, 1967–69, PET 6 US)
5. Not found.
6. In his briefing memorandum, Battle forwarded to Rostow a variety of development proposals which other sectors of the American business community had suggested. (National Archives and Records Administration, RG 59, Records of the Department of State, Central Files, 1967–69, PET 6 US)