Evening star., 1951-04-01

lowing. SauQl ARABIA, b0U,UUU
barrels daily; .Kuwait, 100000
barrels; Iraq, 10000 barrels;
Egypt. $4,000 barrels; the Qatar
Peninsula, $4,000 barrels; Bah
rein, $4,000 barrels. These, plus
Iranian supplies, are nearly suffi-
cient for Eastern Hemisphere
consumption, although there is a
daily average flow of some $50 600
barrels Of finished products from
the United States to Western
Europe. Expansion of this Ameri-
can flow to Europe, incidentally,
would be the signal for cutbacks
or rationing in this country, at
least until such time as our own
capacity could be further de-
veloped.
Strategic Considerations
Beyond these gloomy possibili-
ties are the more far-reaching
strategic considerations. While
denial of Iranian oil to the West-
ern world would not automati-
cally place it at disposal of Russia
it could open the door to such q
possibility. Iranian nationals
might undertake to operate their
Oil properties without foreign as
sistance but If the finished
products are to get to the nom
Communist countries, transport
and distribution would still have
to be handled by non-Iranian
agencies. If Iran should go to
the other extreme of inviting or
allowing Russian technicians to
participate in the production
there would undoubtedly be a
complete shutdown of supplies to
the free nations. Whether this
Russians could devise any man
ner of getting the oil from Iran
to Russia is another problem. cer-
tainly a most difficult one in the
face of the mountain frontier
between the two countries. but
the denial to Communist ma
tions would still be a great ad-
vantage to Moscow.
A brighter side of the picture
is the possibility that the AIOC
may still be able to work out an
agreeable operating relationship
with the Iranian government. It
lis expected that Assistant Secre.
tary of State George McGhee.
due in London this week end
after recent conferences in
Teheran, will attempt to facih-
tate some such negotiations.
Negotiations DRAGGED
Here, students of the world oil
problem are shaking their heads
sadly at the present state of af-
fairs and the circumstances
which brought it about.
Since 1948 negotiations ave
been going on spasmodicaliy be-
tween Iranian authorities and
the AIOC. In that year the
British company offered an in
|crease in royalties from % cents
per barrel to SO cents but the
proposal was finally turned down.
In 1850 the late Prime Minister
|Razmara asked additional con-
|cessions by the British in the
non financial field. such as en-
ployment of more Iranian ma
tionals, increased information on
company operations and so forth.
Despite diplomatic urging from
Washington that the compery
make greater efforts to reach an
agreement. the negotiations
dragged until Razmcra's assas-
sination several weeks ago and
the naturalization action by ths
Iranian Parliament.
Meanwhile, the Arabian-Ameri-
can Oil Co.. a wholly Ameri-
can-owned concern operating in
Saudi Arabia. took the initiative
in agreeing to pay so cents per
barrel royalty to the Saudi gov-
eminent. The comparison was
not pleasing to either the Iranian
government or to the AIOC.
For comparative purposes the
Iraq Petroleum Co-American.
British, Dutch and French owned
pays SO cents royalty.
the Bahrein Petroleum Co., Amer
ican- n-owned, pays 80 cents ard
the 'Kuwait Oil Co., Ltd, Ameri-
can-British, pays 9 cents. Kuweit
has recently asked an increase in
this rate.
Disturbing Possibility
The Iraq agreement was ne
gotiated in 1850 and a new pipe
line now under construction be-
tween the Kirkuk fields and
Tripoli on the Lebanon Mediter-
ranean coast is calculated to add
350. 900 barrels daily to the pres
ent 100000 barrels Of production.
In Iraq. however, there also is
agitation for naturalization with
most of the political pressure COM
ing from the Independent Party,
"a rightist group that supported the
pro-Nazi COUP in that country IN
the early days of World We II.
Eventual disposition of the I'm
trouble probably will have "reat
effect on the Jraq controvers,-.
Perhaps most disturbing OF all
the possibilities Inherent in .he
Iranian situation is the one that
the British might decide to "pro-
tect" the oil properties by military
force.
Since the 10th century Britain
and Russia have applied a form Of
imperialiStic thinking to their con.
duct with regard to Iran and have
operated. In fact, on a theory that
each had a sphere of interest"
there. This theory was manifest,
and it might be defended, in World
War II by Joint occupation Of
the country with British forces in
the southern half and Russian in
the north. Since there is still IN
existence Russian-Iranian tres ty