OIL: The Big Split

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Most oilmen feel that Texaco and California Standard will not be long in making their peace with the Government. The fact is that the Government has moved far from its original 1952 position. The Jersey Standard and Gulf decisions explicitly recognize that the realities of the oil world require two standards: what" may be monopoly at home is sometimes a necessity abroad, required by foreign law or even the exigencies of U.S. defense policy. When the Iranian government seized the oil industry in 1951, there was a real danger that other Middle Eastern nations might follow suit. The Defense Department got the Justice Department to grant U.S. companies a special exemption from antitrust action so that they could set up a joint "disaster-plan" cartel to combat the threat.

The new decrees reassert the rights of the oil companies "without limitation" to combine for defense purposes, and specifically promise that the companies can combine to do business wherever legally necessary in a foreign country.

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