CURRENT INTELLIGENCE BULLETIN - 1951/06/30

• Document Type: SPECIALCOLLECTION
• Collection: Current/Central Intelligence Bulletin Collection
• Document Number (FOIA) /ESDN (CREST): 02003078
• Release Decision: RIPPUB
• Original Classification: U
• Document Page Count: 9
• Document Creation Date: March 18, 2019
• Document Release Date: March 28, 2019
• Publication Date: June 30, 1951

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30 Arne 1951 
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CURRENT INTELLIGENCE BULLETIN, 3 
DOCUMENT NO.  
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DATE11�11# r 1_ REVIEWER: 
Office of Current Intelligence 
CENTRAL INTELLIGENCE AGENCY 
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SUMMARY 
GENERAL 
3.3(h)(2) 
1. US Ambassador in Moscow comments on Gromvko interview (page 3) 
FAR EASt 
3.3(h)(2) 
6. IndortBsia will embargo rubber to China (page 6). 
SOUTH ASIA 
Indian Government is gravely concerned over possible loss of Iranian 
oil (page 7). 
NEAR EAST 
8. US considers proposing a sixty-day moratorium in oil dispute (page 7). 
WESTERN EUROPE 
9. British delivery of Polish tankers reviewed and delayed (page 8). 
10. Interim interzonal trade agreement probably would release Berlin 
exports (page 8). 
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GENERAL 
US Ambassador in Moscow comments on Gromyko interview: 3.3(h)(2) 
US Ambassador Kirk in Moscow believes 
that Gromyko's specific on-the-spot answers 
to important questions indicate that the Soviet 
Government considers the Malik proposal a 
serious effort to achieve a Korean settlement, regardlesS of its propaganda 
implications. Karitfeels that the Chinese People's Republic is also behind 
the move. 
Gromyko's insistence that cease-fire negotia-
tions remain separate from political and territorial questions implies 
that such questions will be raised later in connection with the Communist 
terms for settlement, There is no evidence that these terms will not 
initially include Chinese Communist membership in the UN, control of 
Taiwan, Chinese and Korean participation in the Japanese peace treaty, 
as well as the evacuation of all foreign troops from Korea. 
The US Ambassador is inclined to suspect 
that the Chinese Communists are unwilling to continue the costly camp-
aign and that urgent requirements of the Chinese over-all program neces-
sitate abandoning the venture, at least for the present. He speculates 
that the importance of China to the USSR constrains the Soviet Government 
to react with greater flexibility than is customary with the Eastern European 
Satellites. Considerations of face make the Chinese Communist Govern-
ment prefer that the USSR initiate the advances. 
� In answer to British proposals for further 
soundings of Communist China, North Korea and possibly the Soviet Gov-
ernment, Kirk emphasizes that Gromyko carefully sought to avoid govern-
mental discussions in favor of direct negotiations between military comman-
ders. The Ambassador considers that the opening move should be made 
by General Ridgway and the South Korean commander, 
Comment: There is no evidence that the Peip-
ing regime is anxious to sue for peace at this time. It is possible that the 
USSR's desire to avoid direct involvement in the war and increased material 
�support for the Communist forces is the primary motivation underlying the 
proposals. 
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FAR EAST 
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6. ,Indonesia will embargo rubber to China: 
3.3(h)(2) 
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The Indonesian Cabinet agreed on 27 June 
that rubber should be included unconditionally. 
in the list of strategic Indonesian exports 
that, in accordance with the UN embargo, 
will be denied to Communist China. 
3.3(h)(2) 
Comment: Indonesia abstained in the UN 
when the embargo was voted. Subsequently, the government prepared a 
list of strategic materials to be prohibited to China; this list, however, 
excluded rubber. Indonesia historically has not shipped rubber  
to China, 
The reversal of Indonesia's position occurred after the US Ambassador 
inlaakarta had stressed that, under the Kern Amendment, Indonesia 
might not qualify for US aid if it omitted rubber from its strategic list. 
Prekelects fir the strict implementation of the embargo by Indonesia 
are limited, however, since the government lacks the administrative 
machinery to control adequately the destination of privately-owned 
rubber. 
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SOUTH ASIA 
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7�4 Indian Government is gravely concerned over possible loss of Iranian oil: 
The Secretary of the Indian Ministry of Exter-
nal Affairs says his government is gravely 
concerned over events in n, which not only 
add to the threat of world war, but also might 
entail the loss to India's economy of vital Iranian oil. On 23 June, accord-
ing to the Secretary, Prime Minister Nehru sent a message to the Prime 
Minister of Iran, expressing his hope that the Iranian Government would 
observe moderation in the oil dispute and attempt to reach an amicable 
settlement 
� 
Comment: Prime Minister Nehru and the 
Indian press, motivated largely by feelings of Asiatic nationalism and 
apparently unaware of possible economic 'consequences to India, have 
previously been outspoken in supporting Iranian action to nationalize the 
oil industry. Now that Iranian oil supplies seem likely to be cut off, 
they have belatedly remembered that 95 percent of the petroleum products 
annually consumed in India are imported and that Iran has provided about 
two-thirds of these imports. 
� 
, NEAR EAST 
8. US considers proposing a sixty-day moratorium in the oil dispute: 3.3(h)(2) 
The US Department of State is prepared to 
suggest a "moratorium" to Iran, and the 
adoption of interim arrangements for 60 days 
between Iran and the Anglo-Tranian Oil Com-
pany that would, without prejudice to the 
issues involved, permit operations and oil 
shipments to continue until a more perma-
nent settlement could be worked out. When 
this proposal was submitted to British Foreign Minister Morrison for 
comment, he indicated that the US proposal appeared both helpful and 
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constructive, and expressed the AJK's willingness that such an approach 
be made. Mr. Morrison urged, however, that it be made clear to the 
Iranians that operations of the oil industry must be under full AIOC manage-
ment, and that interim financial arrangements must be along the lines 
already proposed by the AIOC. 
Comment: While the new proposals offer a 
ray of hope, it is unlikely that they will be acceptable to the Iranians, 
especially in the form suggested by Morrison, unless Iran is willing to 
make a major change in its oil nationalization policy. In view of British 
experience with Iranian intransigence, the UK probably does not attach 
much hope to this current effort to break the impasse. 
WESTERN EUROPE 
9. British delivery of Polish tankers reviewed and delayed: 
3.3(h)(2) 
Foreign Secretary Morrison expressed in-
terest to4JS Ambassador Gifford in the idea 
that the Iranian oil crisis might justify de-
laying the delivery of the Polish Government-
owned tankers being built in British ports. Meanwhile, the Foreign 
Office reports that the trials of the first two tankers, delivery of which 
had been expected by mid-july, have been postponed by two weeks, and 
are now scheduled to begin on 9 Wy. 
Comment:. Review of the issue in the light 
of the Iranian crisis and delay in the trials follow vigorous US represen-
tation along those lines. The stated UK position remains that the vessels 
will be delivered flue to the legal principle involved and to fear of retaliation. 
10. Interim interzonal trade agreement probably would release Berlin exports: 
US representatives in Berlin believe that the 
Soviet authorities in that city may resume 
clearing West Berlin export permits if a new 
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3.3(h)(2) 
interzonal trade agreement, or an interim 
agrangement, is concluded by the East and 
West Germans without delay and confirmed 
by Allied authorities. The Berlin trade repre-
sentative of the Bonn Government reports that the East Germans appear 
favorably disposed toward a two months' extension of the present interim 
agreement, which will expire 2 July. Meanwhile, the Soviets failed to 
pass any export permits on 28 June, and the backlog is now over 7,000. 
US officials believe the USSR is determined 
to exert strong pressure for the early conclusion of a trade agreement 
The chairman of the East German state planning commission said on 
28 June that if all interzonal trade agreements, including interim arrange-
ments, are allowed to lapse on 2 July, then complementary agreements 
will also become invalid, resulting in the stoppage of the delivery of 
electric current and coal to West Berlin. 
Comment: The determination of the Soviet 
authorities and the East Germans to get an early trade agreement might 
prompt them to apply further pressure in the form of cutting off coal and 
electric power supplies to West Berlin. In that event, West Berlin could 
resort to its three months' stockpile of coal and its own adequate, though 
more expensivefsources of electric power. 
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