Dwight D. Eisenhower photo

Memorandum for Arthur S. Flemming, Director of Defense Mobilization, Concerning the Distribution of Petroleum Supplies.

October 12, 1956

I APPRECIATE receiving a report from you stating that it would be possible under the authority of the Defense Production Act for the Government to enter into contractual arrangements with United States ship yard owners for the construction of large tankers--up to the total called for by the Government's full emergency requirements--with the understanding that the Government would acquire these tankers in those cases where private ship owners did not purchase them.

I am directing, therefore, that you take steps immediately to bring together representatives of the National Petroleum Council to meet with the Secretary of State, the Secretary of the Treasury, the Secretary of Defense, the Secretary of the Interior, and the Secretary of Commerce, to consider plans that will be helpful in assuring the efficiency and adequacy of the distribution of petroleum supplies in the foreseeable future in the free world.

These plans should, so far as the interests of the United States are thereby served, provide for the building in United States ship yards of a sufficient number of large tankers to help supplement existing means of distribution and, if necessary, to help serve as an alternative in the transportation of oil in the free world, particularly from the Middle East. The Government's commitments in these regards should be limited as indicated in the first paragraph above. In addition, the Federal Government might, whenever necessary, provide funds for rehabilitation and modification of American ship yards so long as these projects can be undertaken on a self-liquidating basis.

The study should proceed, of course, on the assumption that plans which are developed are to be consistent with the requests that you have made to oil importers to voluntarily keep imports of crude oil into this country at a level where they do not exceed significantly the proportion that imports bore to the production of domestic crude oil in 1954.

The results of these deliberations should be reported to me as soon as practicable.


Note: On November 30, 1956, the White House announced that the President had authorized the ODM Director to request the Secretary of the Interior to permit the United States petroleum industry to coordinate its efforts to assist in handling the oil supply problem resulting from the closing of the Suez Canal and some pipelines in the Middle East. The release stated that "the United States desires to cooperate as fully as possible in lessening the effects of the present situation in both producing and consuming countries. The contemplated coordination of industry efforts will insure the most efficient use of tankers and the maximum availability of petroleum products."

Dwight D. Eisenhower, Memorandum for Arthur S. Flemming, Director of Defense Mobilization, Concerning the Distribution of Petroleum Supplies. Online by Gerhard Peters and John T. Woolley, The American Presidency Project https://www.presidency.ucsb.edu/node/233380

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