Chiefs of Staff for the shipment to Iran of certain essential military supplies.

The Department desires to urge that high priority be given to the shipment of these military supplies for the Iranian Army. It is realized that the War Department is being pressed to supply arms not only for urgent war needs but also for the use of postwar armies. It is considered, however, that the Iranian case differs in several essential respects from that of many other countries. American policy in Iran is based specifically on the Declaration on Iran, signed at Tehran on December 1, 1943, by President Roosevelt, Prime Minister Churchill and Marshal Stalin. This Declaration recognized the sacrifices made by Iran in the interests of the war effort and pledged Allied assistance to Iran both during and after the war. A prominent implementation of this policy has been the American adviser program, under which this military mission has so successfully carried out its duties. Protection and advancement of our interests in Iran require that we give the military mission the tools with which to work. Furnishing the Iranian Army with essential supplies is in line with the Department's basic policy toward Iran, which envisages strengthening the Iranian security forces to the point where they can maintain order after the withdrawal of Allied forces. The United States can contribute substantially to world security by assisting to create a strong Iran, free from internal weakness which invite foreign intervention or aggression. To carry out this policy requires strong and wellequipped security forces.

Iran is perhaps the most prominent area of the world where interAllied friction might arise. Such friction would grow out of the chaos and disorder in Iran which would result from a weak Iranian Army. It is in our interests to prevent this from happening.

For these reasons it is urgently recommended that the American military mission to the Iranian Army be continued for an indefinite period beyond March 1, 1945, and that a sufficiently high priority rating be given to General Ridley's request for military supplies to enable him to continue his mission in Iran with reasonable assurance of success.

891.51A/12-2644: Telegram

The Ambassador in Iran (Morris) to the Secretary of State

TEHRAN, December 26, 1944-3 p. m. [Received December 26-1:05 p. m.]

950. My telegram No. 932 December 15. On December 20 Medjliss Finance Committee approved modified form of Prime Minister's bill for transfer of Millspaugh economic powers. Changes provide that

powers shall be exercised by Bayat personally with the assistance of a committee of 4 chosen with the consent of the Council of Ministers. He would be authorized to take under his direct control all organizations created under the law of 13th Ordibehesht, as well as economic organizations existing before that law and all state monopolies and Government-owned institutions, and to operate them independently or attach them to one or more ministries. He would also be empowered to dissolve such organizations. Any new or altered organizations should be presented for Medjliss approval within 3 months. Government would be instructed to make an audit of all economic organizations and report to Medjliss within 3 months. Law to be valid for 6 months.

This bill was to have been reported to Assembly December 21 but was sidetracked for provisional budget bill for current 2 months. Sessions of December 22 and 24 produced no action and next meeting has been set for December 31.

MORRIS

891.20 Mission/12-2744

The Secretary of War (Stimson) to the Secretary of State

WASHINGTON, December 27, 1944. DEAR MR. SECRETARY: I have your memorandum of December 21, 1944, setting forth the urgent political reasons for the continuance of the American Military Mission to the Iranian Army and asking that consideration be given to the request of General Ridley, the Chief of this mission, for the granting of a priority for the allocation of military supplies required by the Iranian Army.

In view of the cogent reasons expressed in your memorandum for the continuance of the mission after its present expiration date of March 1, 1945, it has been carefully considered by the War Department and it has been decided that the mission will be continued for an indefinite period after March 1. General Ridley, Chief of the mission, has been informed of this decision.

It is recognized, also, that the protection and advancement of our interests in Iran will require the strengthening of the Iranian security forces so that order may be maintained in this area, where world security might be threatened, after the withdrawal of Allied troops. This Department, therefore, will present to the Joint Chiefs of Staff for their consideration the request for a priority for these military supplies.

Sincerely yours,

HENRY L. STIMSON

ATTITUDE OF THE UNITED STATES TOWARD DECISION OF THE IRANIAN GOVERNMENT TO POSTPONE ALL PETROLEUM DEVELOPMENT NEGOTIATIONS; REPRESENTATIONS TO THE SOVIET UNION REGARDING UNFAVORABLE SOVIET REACTION

891.6363/827: Telegram

48

The Chargé in Iran (Ford) to the Secretary of State

TEHRAN, March 9, 1944-noon. [Received March 10-7:57 a. m.]

176. Department's special instruction 317, January 27.49 Status of our oil negotiations with Iranian Government is as follows:

Draper has presented his proposition to Prime Minister 50 and it is now being studied. Certain essential figures are being withheld until negotiations have reached more positive stage.

In interview yesterday with Soheily he stated British 51 had just presented supplemental proposal which had not yet been translated. He told me that should he continue in power (which becomes increasingly problematical) he would give us every ethical opportunity to meet our competitors in this field since he remained desirous of having American oil interests enter Iran and was particularly opposed to having entire southern coast of Iran tied up under British concessions. For our future guidance and particularly [pending?] decisions reached at forthcoming London discussions, I should welcome Department's directive regarding attitude I should adopt vis-à-vis my British colleague in Tehran 52 on general subject our oil negotiations here. Thus far I have remained completely noncommittal regarding active interest we are taking in this subject in Iran despite repeated openings by Bullard. My first reaction has been and still is to be quite frank with him, (1st), because he unquestionably knows Draper is here and has presented his proposition and thus when our activities eventually are brought into the open he will be in position of being able to question the degree of our good faith which otherwise characterizes all of our relations, and (2nd), because without wishing to appear overly naive in this matter, I feel that with a careful and open handling of this question with both British and Soviets we might well be given, if not a free hand, at least a less competitive field in Iran than might otherwise be the case. Britain is determined to keep her political skirts clear in Iran, and while she will never be above turning an

49

48 For previous correspondence, see Foreign Relations, 1943, vol. IV, pp. 625 ff. 'Not printed; it transmitted a letter from the Standard-Vacuum Oil Company to its representative in Iran for oil negotiations, Thomas J. Draper. 50 Ali Soheily.

51

The Royal Dutch Shell Company.

52

Sir Reader W. Bullard, British Ambassador in Iran.

honest penny either now or in postwar developments, my personal belief is that we would be on firmer ground by inviting her cooperative interest in our negotiations now than by appearing to be keeping her in the dark about them. Certainly every effort should be made to avoid having the pending oil negotiations degenerate into an auction sale which might well happen with Iran acting as auctioneer. In recent talks with Saed,53 who appears to be most favored candidate for next premiership, and with Ala,54 mouthpiece of Shah, it is evident Iran wants our oil interests here, but in last analysis financial considerations will carry great weight.

Sir Reader Bullard, who is today presenting his letters credence to Shah as Ambassador, informs me he is leaving for London toward end of March, presumably in time to participate in London discussions. FORD

891.6363/835f: Telegram

The Secretary of State to the Chargé in Iran (Ford)

WASHINGTON, March 27, 1944-11 p. m. 192. Your 176, March 9. Department has no objection to your mentioning to your interested colleagues fact that Draper is in Tehran representing Standard-Vacuum Company in negotiations connected with an oil concession, information which is beyond question already in their possession. Department believes it would be unwise to go beyond this simple statement, which represents the actual situation. You should avoid any action or statement which might give the Iranians cause to infer, or British oil interests at later date grounds to imply, that there exists any British-American understanding whatsoever to hold down cost of oil concession or to share any concession obtained. With reference to Tass release setting forth Soviet claim to prior rights to petroleum concessions in north Department would welcome any further information you may obtain on subject.

HULL

891.6363/836: Telegram

The Chargé in Iran (Ford) to the Secretary of State

TEHRAN, April 3, 1944—11 a. m. [Received 3:15 p. m.]

227. Department's 192, March 27. In informal conversation with Prime Minister Saed 55 I called to his attention Tass release on oil

53 Mohammed Saed, Iranian Foreign Minister.

51 Hussein Ala, Minister of the Iranian Imperial Court.

53

A change of government had occurred on March 17, 1944.

concessions. He pointed out that provisions of Soviet-Iranian Treaty of 1921 56 could be revoked only with respect to valid concessions, and that concessions must be approved by Majlis to be valid. He then reiterated Iranian position that Khostaria Concession, principal basis for Russian claims to exclusive rights in northern Iran, was never valid since never approved by Majlis.57 He therefore considered northern Iran definitely open to development by oil interests of any nation.

When Draper of Standard-Vacuum asked whether northern area could be included in concession being sought by his company, Saed replied he knew of no reason to contrary, although he admitted it might be wiser to defer any active exploration of that area until after Soviet troops should have been withdrawn and suggested that a clause to that effect might be inserted in concession.

Draper privately assures me that despite this apparent freedom to enter northern zone, he proposes to confine his present negotiations to southeastern area.

FORD

891.6363/834: Telegram

The Secretary of State to the Chargé in Iran (Ford)

WASHINGTON, April 4, 1944-7 p. m. 207. Messrs. William Campbell and Walter Wilson will arrive at Tehran about April 3 or 4. They are representing Mr. Marcel E. Wagner (American Eastern Corporation) who is acting for Sinclair interests.58 We have discussed with Mr. Wagner the possibility that the entry of another American company in the Iranian oil negotiations might jeopardize the overall American interest. Wagner indicated he would discuss this with Mr. Sinclair. However, Wagner is of the opinion (1) that Iranian concession will not be granted to Standard-Vacuum interests in any case because the Iranians consider Standard-Vacuum to be tied too closely to the British Anglo-Iranian interests,59 and (2) because of the foregoing the chances of the Sinclair group to secure a concession would be jeopardized by any merger of forces with the Standard-Vacuum group, and (3) the Sinclair interests will be diligent in developing any concession rights obtained. The foregoing is for your confidential information and we would like your comments thereon.

56 Signed at Moscow, February 26, 1921, League of Nations Treaty Series, vol. IX, p. 384.

57 For correspondence regarding the Iranian position, see Foreign Relations, 1921, vol. II, pp. 649-651.

58 The Sinclair Oil Company.

59 The Anglo-Iranian Oil Company.