22
Singapore Oil
Embargo

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    I let the matter rest. Then, ironically, the whole issue was overtaken by a totally new and unexpected interpretation of the text of the Arab oil embargo. The embargo expressly forbade deliveries of products made from Arab oil, as used in Singapore refineries, to the US and its armed forces. Vietnam had not been mentioned in the text at all. In a fit of excessive zeal, however, to please Saudi Arabia, where they had tremendous investments, or to make more product available for other markets, or even because Vietnam was simply a public-relations nightmare, Esso Singapore had deliberately given the embargo such a wide interpretation that they claimed no longer to be at liberty to supply products paid for by the US government and made from Arab crude to Vietnam. In the same vein, shortly before and during the Middle Eastern war, Esso and the other American companies united in Saudi Aramco had petitioned the President of the United States to stop military supplies to Israel. If that request had been taken seriously, Israel would have been written off.
    For Vietnam, however, there was no other crude source on the horizon, and this tortuous interpretation, swiftly endorsed by the Singapore government and automatically applicable to us, suddenly cut the lifeline of oil to Vietnam, and threatened to render the ARVN powerless and South Vietnam defenceless. This came on top of the armed forces already having to reduce operations because the American fuel supply budget had not been increased in line with price rises.
    Giu and I rushed for explanations to Esso's Saigon office. With its wall-to-wall carpeting, Western secretaries, bricked-up windows and electric lighting throughout the day, it belonged to a claustrophobic foreign future, whereas our office, with its gilded baroque and open windows, clearly belonged to the easy-going South Vietnamese past. But differences went deeper: the Vietnamese assistant of the president who received us in no way resembled our own abrasive Giu. He was young, college-educated and forward-looking, with faultless English and infinitely more comfortable to talk to, but with none of the nationalist passion of Gin. In the absence of his president, who was in the United States on leave, he regretfully accepted that Esso Singapore had to abide by the implicit ban on deliveries to the Vietnamese army. The fact that after the exhaustion of stocks the ARVN would be immobilised and the North could pick off its units one by one or that the immobilisation of the airforce would make Northern superiority overwhelming did not seem to matter. None of this seemed to touch him personally. By now, however, we knew our competitors well enough to realise that neither they, nor Caltex, would ever question a decision taken by their principals. It meant that only we could get the Singapore government to reverse their decision.
    We had limited time left. I phoned my Singapore colleague, but he was away at a meeting in London, so I took a flight to Singapore. After hearing from the product supply manager that Shell had merely followed the lead of the American companies, I drove to government office, where an official explained to me in confidence the entire course of events. He confirmed that the local American oil company presidents, eager to apply the strictest possible interpretation of the embargo, had taken the initiative to cut deliveries to their own navy and the Vietnamese armed forces. To do this legally, they needed the official extension of the embargo to the Vietnamese armed forces. Otherwise they would have been vulnerable to customer claims for non-performance of contract. Therefore, they had pressed the Singapore government for a confirmatory decree. Please make it official, they had begged, so that we can claim force majeure with our customers. Oh, and here is your draft decree, already drawn up by our lawyers; you only have to sign and publish it. The Singapore government had merely obliged. Unfortunately, in the absence of the Shell Singapore president, my own representations carried no authority. The small island state could hardly go against the official advice of the local leaders of the industry on which the whole existence of the state depended. Once
the government had signed and published the ban, only a strong counter-force could make them change their minds; for instance, explicit approval for deliveries by an important OPEC member, acting in concert with the US government.
    Back in Saigon that night, after the personnel had gone home, I went to the telex room, where the night-shift operator sat in front of her machines. She happened to be the ex-girlfriend of Trung, who had resigned with such panache after the first sapper attack on Nha Be. She had proved totally trustworthy and devoted to the job since her transfer. An idea was forming in my mind while we watched London's messages cascading in. We had to produce an irrefutable counterargument for the Singaporeans, and after a while I began tentatively dictating an appeal to the Saudi Minister of Petroleum, Sheikh Yamani, with the pompous beginning, 'In the name of our common commitment to democracy in Vietnam...' But this was way overstated; the Saudis were anti-Communists but no admirers of democracy. I therefore deleted the commitment bit and just said, 'In the name of the survival of our staunch South Vietnamese allies'.
    No lesser words could do justice to our cause. My methods might be wrong; I had no earthly mandate, the end might not justify the means, and I was a worm, but I let the noble preamble go on line. 'I have to draw Your Excellency's attention to the decision by the Government of Singapore to deny oil supplies to the South Vietnamese armed forces in application of an interpretation of the OPEC oil embargo, which I personally believe to be based on an outrageous misunderstanding of its terms. If Your Excellency agrees with me that the text of the embargo only refers to American forces and not at all to the South Vietnamese forces currently fighting for survival in the free world, and would inform the Singapore Government accordingly, desperate consequences can still be avoided.' The message ended with my name and that of the company. I watched it go, and tried to visualise Yamani's face reading the text.
    Years ago, Yamani and I had made reluctant conversation while we were both waiting in an ante-room at the palace in Doha for a private word with Sheikh Ahmed of Qatar. He was called in first as a Saudi minister, a successor to the famous Tariki, but his standing amongst sheikhs was still that of a humble palace servant. Now he was an international celebrity. Whether he remembered or not, he would read my message as a true outburst from the ranks. As for my principals in London and the Hague, who only spoke to him after weighing their words on a gold scale, I could only be sacked once.
    Feeding the copies into the shredder, the telex girl and I were joking about our message, and about the odd telexing styles of our colleagues, when suddenly the Riyadh line came alive with an answer: 'In the name of Allah, the Merciful. Grateful if you could address your message to HRH King Faisal. Thanks.' It was unsigned. Perhaps it was only a telex clerk's suggestion, but we changed the 'Excellencies' of the text into 'Royal Highnesses' and let it go again. In for a penny, in for a pound.
    We never received a direct reply, but a decisive reaction to the Singapore Government, in the form of official Saudi approval for deliveries of its oil to Vietnam, was duly made, and when several months later the press reported that King Faisal had also made an offer to the American government to pay for all the expenses of the Vietnam War, I was again reminded of the evening in the telex room with Trung's ex-girlfriend. But nothing ever came of the offer. By then, the Nixon presidency had been too weakened by the Watergate scandal to take things further, and to be able to put the financing of the war on a firm footing.
    A few loose ends needed to be tied up by the American embassy in Saigon. Graham Martin was, as usual, in Washington lobbying a reluctant congress. His stand-in, the dedicated and indefatigable Josiah Bennett, showed me an intercept of a communication from Communist headquarters in South Vietnam (COSVN) to Hanoi on the Nha Be sapper attack. It described the action modestly as a media event, and not in any way intended to convey that the peace-loving forces no longer respected the Paris peace agreement. But Nha Be was already far behind us.
    The immediate task was to delete all mention of American involvement in the oil supply contract with the Vietnamese Government, to help the Singapore government through the embarrassment of reversing its decision. The embassy would clear it with the Vietnamese later. First they put the specific recommendation to the Secretary of State, Henry Kissinger, who happened to be in Tokyo at the time. Kissinger made the telephone call to Riyadh and the South Vietnamese armed forces were disembargoed within a day. The Singapore government were only too happy to rescind their edict. But still, to my amazement, the American companies, sulking from loss of face, or for other reasons, refused to supply their share of the new contract, and thus made Cong-Ty Shell a monopoly supplier by default, at very profitable prices, for a few months, until they could bring themselves to swallow their pride and claim back their legitimate share. Cong-Ty Shell's dividends doubled on this windfall alone, without any resort to creative accounting.