HC Deb 02 August 1957 vol 574 cc1738-54

2.49 p.m.

Mr. John Dugdale (West Browich)

I wish to direct the attention of the House to another case of the curious relationships of Her Majesty's Government with private firms. This one deals with the relationship of the Government with a firm carrying out business in the Middle East.

Three weeks ago there was an announcement that the Shell Oil Company, of Palestine, intended to discontinue its marketing operations in Israel. These operations have been continued for a very long time, ever since the First World War. It came as a great shock to people both in Israel and in this country to hear that it was to be terminated. In parenthesis, I should say that although this particular firm is called Shell Oil Company, it is owned as to half by Shell and half by B.P. It is a joint concern of the two companies. This has some relevance to the remarks I shall make later.

Was it done for commercial reasons? The fact is that the Shell Oil Company of Palestine acts, in its marketing operations, on a cost-plus basis. It is, therefore, very difficult to see that any great loss can be involved. It may not, perhaps, have made as much money as it would have made had it made it somewhere else, but it is difficult to see that there could have been any very great loss in marketing operations on a cost-plus basis. There is more to it than that.

When the announcement was made, the Israeli Government asked whether it was possible to give any other kind of terms, whether the commercial terms were unsatisfactory, how much more money the Shell Oil Company would like if it was to continue its operations. They were met with a blank refusal to state anything at all. They were left with the conclusion that the Shell Oil Company, apparently, was intent on leaving the country even if it could have better commercial terms offered. That was the only conclusion the Israelis could come to.

What, therefore, is the reason for the company's action? If they are not ordinary commercial reasons arising from the fact that the company was making less money than it thought it ought to make, what is the reason? I believe that the reason is nothing more or less than Arab pressure, the usual Arab pressure which has been exercised on many firms, on different companies operating in Israel, a pressure which is, I may say, largely bluff. Let me give one or two examples. Germany, for instance, was asked—indeed, warned—to abandon her reparations agreement with Israel, and told that if she did not German exports to Arab countries would suffer. Germany refused to do so, and, in fact, she is now exporting more than she ever exported before to Arab countries.

Perhaps the most remarkable example comes from France. A French firm of motor car manufacturers was told that it must no longer sell its motor cars to Israel. It said that it had no intention of complying, and, as a result, it is now selling more motor cars than ever to Arab countries; and, strangely enough, among the owners of cars made by this company are three members of the Arab Boycott Board.

It is not only French and German firms which are not afraid to call the Arab bluff. Many British firms, also, have paid no attention whatever to what the Arabs have said, and they have continued their operations in Israel. Some of them have been fairly small firms; they have been threatened by being rung up suddenly and asked whether they had an agency in Israel, and what was its name. When they replied that they had, they were told, "This is the Arab Boycott Agency. We have heard that you have relations with Israel, and we shall act accordingly". That sort of thing has been going on continually, yet these firms have remained in Israel.

Now, however, we have a large British firm which has carried out what I can only describe as a squalid deal with the Arabs, deciding to give up its interests in Israel in order to secure the hope or promise of further gains in its trade with the Arab world. This follows another action on the part of the company. The House will remember that, a short time ago, the Secretary of State for Foreign Affairs made it quite clear that he, personally, had nothing against British ships going through the Gulf of Aqaba; in fact, one came to the conclusion from what he said that he would welcome it.

In spite of that, no British tanker, as I understand, has been through the Gulf of Aqaba yet, although American tankers go. I hope that the right hon. Gentleman can correct me; I hope that I am wrong, and that British tankers have been through. So far as I understand, no British tankers have been through, and they would have been if the Shell Oil Company had had the courage to send them through.

What is to be the effect on the Arabs? We all know that relations between Israel and the Arab countries are certainly not as they should be, but there have been recent hopes that there might be a slight improvement. The Prime Minister of Pakistan who is, after all, the Prime Minister of one of the leading Moslem States, recently made the important statement: After all, there is Israel, and everyone realises that there must be an agreement between the Arab world and Israel itself. Coming from the Prime Minister of Pakistan, these words should carry some weight. It may be that they did carry some weight in the Moslem world, but this action of the Shell Oil Company will do everything possible to encourage the most reactionary and worst possible elements among the Arabs. That is why it is so very serious.

The Government have disclaimed responsibility, You will remember, Mr. Speaker, that when I asked you last week whether I might raise the question in the House, you, very naturally and properly, asked the Government Departments concerned whether they had any responsibility They, that is to say the Foreign Office and the Ministry of Power, disclaimed any responsibility whatever. I would go so far as to say that they misled you in this connection. Quite obviously they have a responsibility.

The Government own 56 per cent. of the shares in British Petroleum, and British Petroleum are half the Shell Oil Company of Palestine. If the Government do not think that 56 per cent. of shares gives the holders any right to speak, they should take the advice of men like Mr. Clore, Mr. Hugh Fraser and other take-over bidders, who know that 56 per cent. of shares gives them a right to speak. The Government could have spoken and made quite clear what their policy was. Why did they refuse to do so?

Why did they not take action? Was it a deliberate attack on Israel? Was it because they deliberately wanted to do the greatest harm they possibly could to the State of Israel? Frankly, I do not believe that it was. I cannot believe that even this Government wanted to do that. On the contrary, I believe that their action was due not to a deliberate intention to harm Israel, not to a deliberate intention to harm British-Israeli relations, but to gross incompetence. I give them the benefit of the doubt. I believe that they did not know that the Shell Company intended to do this until the action was actually taken and that, after it had been taken, they failed to do anything to counteract what had been done. I hope that that is true, because, if it is, they have at least some chance now of making up for their error.

This is not a commercial matter. It is a political matter. If ever there was a case for interfering with the affairs of a private company and for exercising the rights which the Government have as shareholders in the company, this surely is the case. It concerns our relations with the Middle East, and, after all, there is nothing more important too day than our relations with the Middle East, and in particular with the oil which comes from the Middle East. It is, therefore, I should have thought, one of the rare times when the Government could intervene in a case of this kind.

I hope that the Government will say to the Shell Oil Company, "We instruct you to remain in Israel to ensure her an adequate supply of oil, to be brought into the country by the best commercial routes, including the Gulf of Aqaba. We instruct you, in short, to resist the pressure from the Arab League and to continue to bring oil to Israel, and to refine it and to market it there." I beg the Government, before it is too late, to do this, and so remedy the state of affairs which they have brought about by their deliberate policy of refraining from taking any action.

3.0 p.m.

Mr. J. Langford-Holt (Shrewsbury)

In supporting what the right hon. Gentleman the Member for West Bromwich (Mr. Dugdale)has said, I do not want to imply that I agree wholly with all the statements he has made, but time, of course, will not permit me today to cross swords with him upon those things he said with which I do not agree.

I suppose a fair summary of this situation is that it is a commercial matter with strong political implications. It may be true—this I do not know—that over recent years the Israeli Government may have been guilty, if "guilty" is the word, of driving a hard bargain with these oil companies. That may be true, but, of course, poor folk cannot throw their money about, and I am sure of this, that the Government of Israel today would go to great lengths, if not to any lengths, to ensure a reversal of this decision which has now been taken.

Unlike the right hon. Gentleman, I believe this to have been a commercial decision. Unlike the right hon. Gentleman, I do not think it has been a squalid deal, but this I do think, that it has been a supreme example of fecklessness on the part of the companies concerned. The right hon. Gentleman talked of the position of British Petroleum. The Government have consistently said that the directors representing them on the board of British Petroleum take no part in the commercial activities of that company. It is difficult to know, if they take no part in the commercial activities of that company, what they do do. Perhaps they are there to watch the political implications of the activities of the company. This I do not know. Perhaps they are there just to keep a watching brief, but I cannot help wondering whether in those circumstances they fully comply with the provisions of the Companies Act, 1948.

The Paymaster-General (Mr. Reginald Maudling)

We have said that the Government carry out all the normal duties of company directors.

Mr. Langford-Holt

To my mind the normal duties of directors are to watch, if not the day-to-day, certainly the commercial activities of the companies which they direct. Otherwise they are in the position of mere shareholders. Directors who do not perform their duty as directors should be withdrawn from the board. The Government cannot entirely wash their hands of responsibility in this matter. It is not their direct responsibility. I quite agree with that, but they cannot say, "This has nothing to do with us."

I regret that my right hon. Friend the Paymaster-General has to be here to answer this debate, for I think that this is a matter with which it would be far more appropriate for someone from the Foreign Office to deal.

Mr. Dugdale

I asked that there should be a representative of the Foreign Office here, and I had every hope there would be. Apparently one has not arrived.

Mr. Langford-Holt

The threat to the peace of the Middle East is today, as it has been for a number of years, Israel's nervousness, so to speak, of her Arab neighbours. I am no prophet, and I have never made prophecies in this House, but I pointed out a year or two years ago to the Foreign Secretary the dangers inherent in the sense of insecurity which Israel felt then and feels today. Surely we should by now have learned what that sense of insecurity can mean? Surely we have learned something in the last year?

This nervousness arose orginally out of the treaties which we have with her Arab neighbours but not with her. It is, admittedly, true that the treaties with Jordan and Egypt today do not exist, whereas they did two years ago, but we are still, of course, treaty bound with Iraq in more than one way.

There is the question of the 1950 Tripartite Declaration. Very few people know what it means exactly. Certainly I, for one, was surprised that it did not apply to Egypt last November. That was the first I had heard of that. The whole situation of the Tripartite Declaration is uncertain. I remember that when the Foreign Secretary was being pressed to answer Questions about what exactly was meant by the 1950 Declarations he took those Questions to mean, What would be our action? I remember his answers, which were to the effect that be could not state exactly what we should do in a certain set of circumstances which were not at that time known. But as far as I know—and this would have gone a long way towards making that 1950 Declaration mean something—we have never stated that, of course, it meant, if necessary, armed intervention on our part. Nobody in his right mind expected my right hon. Friend to say exactly what military action this or any other Government would take should the 1950 Tripartite Declaration have to be implemented.

All these matters of the 1950 Declaration and the position of Israel are not specifically under debate at this moment, but they surround the whole problem. They always recur. They come up whatever happens in the Middle East. This question of Arab-Israeli relations is today, as always, the key to war or peace in the Middle East. This decision was a commercial one, but it is not a commercial decision of which the Government can entirely wash their hands. It is regarded in the Middle East on the Israeli side as being one more step towards their annihilation, and by the Arabs as one more hope that that annihilation may be achieved, and it spells for us more uncertainty and with that more danger.

The danger is of a feeling in the Middle East, mostly on the Arab side, that all they have to do is to sit and watch Israel collapse. That is not a feasible policy, nor is it likely to happen. This type of action will revive the hope that the blockade of Israel may ultimately be successful. To an attempt to suffocate men whether by blockade or by putting a sack over their heads is not always to act wisely, and that is the risk inherent in the situation today. Tension in the Middle East is heightened as the grip over Israel is tightened, just as Egypt created tension by tightening her grip in the last year.

I believe that the decision we are discussing was a commercial decision, but a decision, however, from which the Government cannot entirely divest themselves of responsibility. Nor can the Government ignore the political implications of the actions of their agents, though perhaps "agents" is the wrong word in this context. I would not go as far as did the right hon. Member for West Bromwich and say that the Government should give orders to Shell in this respect. I do not know that they have the power to give an order to that company, although perhaps through their agents they can give an order to B.P. Because of all the terribly dangerous political implications that this action involves, I hope that the Government will urge the companies concerned to reconsider their decision and reopen negotiations to see whether they cannot continue, on perhaps a different basis, to operate in a way similar to that in which they have been operating for years.

3.9 p.m.

Mr. R. H. S. Crossman (Coventry, East)

I should like to put two very brief points to the Paymaster-General. The first is that, naturally, since the Foreign Secretary made the written reply to which reference has been made, saying that he had no previous knowledge of the decision, we accept his word. We accept that he had no previous knowledge and that this matter was undertaken by the company in all good faith because it interpreted this as a purely commercial transaction.

Very well. Now that the Government know that this has taken place, I want a specific answer to the question whether the Government still regard it as a purely commercial transaction. I shall find it difficult to believe that the Government, who did not know about it before, now that they do know about it do not feel disturbed that the company should have interpreted this in a purely commercial way. I would hope that this error having been committed by the company the Government would feel it possible now, recognising the political implications as all must, to ensure that the company's action is changed.

I think the Minister will agree that there is no great commercial significance for us, in terms of our total oil trade, whether or not we service Israel. It is not a major matter for us or for the companies. It is, however, a not unimportant political matter within the general framework of affairs in the Middle East. Accepting in all good faith that the companies did think this commercial, I beg the Government to tell them that it was not a commercial action and that it must be reconsidered.

The second thing I want to say extends a little further, our consideration of our oil interests in Israel. I regard the freedom of the Gulf of Aqaba, and the rôle which the British oil companies play in keeping the Gulf free, as of even greater importance than the issue of servicing Israel with petrol through Shell and B.P. I think I am right in saying that up to now the interests which have maintained the freedom of the Gulf of Aqaba by supplying oil to Eilat via the Gulf have been American.

I think that the Minister will agree that it is so far mainly American ships which have been pushed through the Gulf, and that no British ship has yet taken part. Will the Minister tell me, therefore, whether the Government consider it desirable for the British companies to play their part in keeping the Gulf open, or whether some instructions have been given to our companies that our ships are not to go through the Gulf of Aqaba to Eilat? If that were so, if there were any understanding between the Government and our companies that we are going to appease the Arabs by not putting our ships through there, I would regard this as even more serious than the cutting out of our oil distribution business.

Those are my two questions. The first is: since the decision was, in the view of the companies, purely commercial and the Government did not know about it, will the Government reverse that decision now? The second is: will the Minister make a statement about the view of the British Government on British shipping proceeding through the Gulf of Aqaba with oil for Eilat?

3.12 p.m.

Mr. Kenneth Younger (Grimsby)

With the leave of the House, Sir, may I, briefly, reinforce the plea made by both sides of the House to the Government on this matter? If the Government did not know about this before, because it was considered purely commercial, they know about it now, as my hon. Friend said. The anxieties felt have been clearly political, and they are real even if the decision was, as I doubt, a purely commercial one.

Most of us in this House said, long before there were disagreements about Suez, that the really important requirement for Western policy in the Arab-Israel dispute was consistency. In the words of the illustrious right hon. Members who wrote to The Times recently, the right hon. and learned Member for Montgomery (Mr. C. Davies)and the right hon. Members for Kelvingrove (Mr. Walter Elliot)and Lewisham, South (Mr. H. Morrison), there must be … a sustained and patient attempt to convince the Arab leaders that Israel has come to stay and must be accepted as an integral part of the Middle East. The Minister will remember that what we thought was a lack of sustained consistency in Government policy was the basis of our criticism as far back as the Guildhall speech of eighteen months ago. We are genuinely and deeply afraid that what is happening now is a repetition of that attitude and, frankly, we do not believe that it is not within the means of the Government, directly or indirectly, to play a really influential part in this matter.

3.14 p.m.

The Paymaster-General (Mr. Reginald Maudling)

This debate has been raised on the proposal of the B.P. company to withdraw from Israel, and that is obviously because the company has a special relation with Her Majesty's Government and the Shell company has not. I will try to set the facts before the House to the best of my ability.

The B.P. and Shell companies collaborate in Israel in two ventures, both run by separate companies though both under the umbrella of Shell-B.P., and both are owned fifty-fifty as between Shell and B.P. There is the refinery which is owned on this joint basis and run by the B.P. company, and there is the marketing company, which is really more important at the moment, and which is run by the Shell company. As I have said, the B.P. Company runs the refinery and the Shell company runs the marketing company, but they both own a half share in each venture.

The refinery's activities fall into two categories. In the first place it refines oil for the marketing company. This is partly oil bought from the Israeli Government, and I think it is partly operating on some Venezuelan crude oil which it had previously bought and holds in stock. It operates on a fee paying basis to refine oil which is the property of the Israeli companies, and this is subsequently distributed by Israeli resident companies. The marketing company markets on a large scale in Israel a range of products, the majority of which come from the refinery, but it also markets a certain number of specialised products which it itself imports.

Those are the functions of the two companies in which Shell and B.P. are operating together, the refining company owning this large and important, long established refinery, and the separate marketing company, whose task is solely marketing. It owns petrol pumps, depots and similar equipment and employs, I am told, about 500 people of whom all but a handful are local Israeli residents. That is the position of the two companies.

Now for the position of Her Majesty's Government. As was rightly said by the right hon. Member for Grimsby (Mr. Younger), the Government own a major shareholding in the B.P. Company. By and large, it is an arrangement which has worked very well since it started. In recognition of this ownership of a majority shareholding, the Government appoint two ex-officio directors of the Company, and I can assure hon. Gentlemen that these persons play a very normal part as directors of the Company, and they also have certain special responsibilities which have in the past been explained to the House in answer to Parliamentary Questions.

It has been the consistent and declared policy of all Governments, so far as I know, not to interfere in any way in the commercial decisions of the B.P. Company. So we have the B.P. Company, in which the Government has a majority shareholding but in whose commercial decisions no Government has interfered to date, sharing with the Shell Company, which is a purely private enterprise concern with no Government ownership. The B.P. Company in conjunction with the Shell Company own the two businesses in Israel.

What is the position that has arisen? I am informed that there has been no decision to close down the refinery or to change or stop its operations, though I think it is right that the House should know that I understand that it is losing a substantial sum of money annually on its operations.

Mr. Crossman

First, will the Minister assure us that a decision to close the refinery would be regarded as a political decision which could not be taken without the consent of the Government? Secondly, will he agree that the refinery is losing money only because B.P. refuses to refine more than the small amount required for local needs and refuses to refine for export? If money is being lost, it is being lost for the political reason that the refinery is not being adequately employed.

Mr. Maudling

I think that the finances of the refinery operations are controlled largely by the level of fees which it receives and the level of prices which it can charge.

Mr. Stephen McAdden (Southend, East)

It is all very well to say that this is a commercial decision. Surely nobody outside Cloud-Cuckoo-Land believes that decisions of this character can be taken by an oil company without having some political bearing. If these things can happen without the Foreign Office knowing, what else may not happen?

Mr. Maudling

I shall come to that point later.

Mr. Crossman

Can the right hon. Gentleman answer my question?

Mr. Maudling

That goes with what I have said about the marketing company. The same principles hold good for both the marketing company and the refinery. B.P. and Shell, the two partners within the company, decided as a matter of commercial judgment that continued operation of the marketing company was no longer commercially justifiable. That was their decision, and the Government have no right whatsoever to challenge the commercial judgment which they exercised. I think that everyone will agree with that. I understand that they made that decision against a background first of general operating conditions in Israel and the relative profitability or unprofitability of the operations, and, secondly, because carrying on would involve investment of substantial additional capital, which, if the oil companies are pushed for capital in other areas, on commercial grounds must be a strong factor in their decisions.

Mr. J. Griffiths

Does the Paymaster-General think that a commercial transaction in this area at this time with this background is one which the Government can regard as having no political implications? Should not any company taking a commercial decision in this area at this time consult the Government, since even though a decision might be taken on commercial grounds, in this area it would have political implications?

Mr. Maudling

One could apply that consideration to any change of price, or change of employment, or any other change. One cannot say that any commercial decision in this area at this time must be a political decision. If one were to say that, Governments would be taking commercial decisions every day.

As I was saying, it was decided that it was no longer commercially justifiable to continue marketing operations, and it was decided, as large American companies have decided in the last year or two, to try to dispose of the marketing operations in Israel. That means that the companies are trying to find someone to whom they can dispose of the physical assets of the marketing company and of the whole marketing company as a going concern.

Mr. Dugdale

Did not the Israeli Government ask them whether, if an alteration in the terms on which they were marketing could be brought about, they would agree to remain in Israel, and did they not refuse even to consider whatever suggested alteration the Israeli Government might have made?

Mr. Maudling

I have no knowledge of the negotiations, if any, with the Israeli Government, because the company decided that it was not commercially justifiable to continue the operations. That was a commercial judgment which they were perfectly entitled to exercise, as some of the large American companies have exercised similar judgments in recent times.

At the moment they are trying to find a purchaser for the marketing organisation to take over assets and to continue the contracts with the employees, taking over the organisation as a going concern. I should have thought that there was every likelihood that they would find a purchaser for the undertaking in the course of the period. They have said that they hope to do it by the end of the year, but if they can find a purchaser before the end of the year, then they will wish to conclude a deal.

It has been asked what will happen if they do not find a purchaser. I must stress that this marketing organisation is not an organisation which imports crude oil for the working of the Haifa refinery. Its job is to own pumps, depots and lorries and to employ people to distribute the products. It is inconceivable, if at the end of the year they have not found a purchaser, that they will walk out and abandon all their installations and leave all their employees. Rather more than 90 per cent. of the people in the company are local residents, and the assets are not assets of the kind which can be carried away.

I do not know what the plans of the company are, but even if it were to walk out because it could not find a purchaser, the machinery of distribution, physical and human, would be left behind. I cannot believe that there is the slightest danger of any breakdown in distribution of petroleum products in Israel as a result of this operation. That is an important fact to bear in mind, because it might be suggested that the decision of the two companies to dispose of their interest in the marketing company might prejudice the distribution of petroleum products in Israel. I do not see how that can arise.

I confirm once again that this was a commercial decision, taken, as my right hon. Friend the Foreign Secretary said, upon the responsibility of the companies concerned and in the normal course of their business.

Mr. McAdden

I think that my right hon. Friend must have misunderstood what I said last time. If it is possible for a commercial decision to be taken to close down the marketing arrangements without a hint of what is going on being given to Her Majesty's Government, can my right hon. Friend say whether it is possible or likely that in future a similar decision to close down the refinery can be taken without Her Majesty's Govern- ment knowing about it? Will he make it clear that he will not countenance any such action?

Mr. Crossman

Will the right hon. Gentleman answer one question straight?

Mr. Maudling

I do not see why Her Majesty's Government should depart from the tradition of not interfering in the commercial judgment of the British Petroleum Company. That is the decision that we have taken in this case, and I have explained our reasons. We regard it as a commercial decision.

Mr. Crossman

It is the Government's repeated view that, upon reflection—after this was brought to their notice—there were no political implications in this action, and that the company was entitled to take this action without consulting the Government. Will the right hon. Gentleman say whether, if the company also close down the refinery, the Government will regard that as strictly commercial, and as being a matter in connection with which they can wash their hands in public again? If so, it is an absolute scandal.

Mr. Maudling

I do not see why the hon. Gentleman takes such a strong line. I was endeavouring to answer his question. The answer is a clear one, and is apparent from what the Foreign Secretary said. We regard this as a commercial decision, taken by the companies concerned, and we are not prepared to intervene in that commercial decision. I are not saying what might happen in a future case, where no decision has been taken or suggested.

Mr. Crossman

We know that the worst will happen.

Mr. Younger

Is not there another issue in this matter? The Government have appointed two directors and they have said: they have a general obligation to report on all matters, financial or general, which they consider should be referred to, or brought to the notice of, Her Majesty's Government."—[OFFICIAL REPORT, 17th May, 1954; Vol. 527, c. 102.] Is the right hon. Gentleman seriously suggesting that this is not the sort of matter which would fall within that definition? It is clearly stated that the Government directors have this duty, and it appears from what we are told that they fell down on this occasion. If they are not to report this sort of decision, what are they to report?

Mr. Maudling

I think that the right hon. Gentleman is quoting from an answer I gave myself in May, 1954. It is true that they have an obligation to report on financial and general matters which they regard as being the concern of Her Majesty's Government, but they obviously did not consider that to be so in this case.

Mr. J. Griffiths

The Minister is speaking for the Government, and not only as the Paymaster-General. Is he telling the House that it is the considered view of the Government, and particularly of the Foreign Office, that in all these transactions which have taken place—and also the possibility of the closing down of the refinery—no political implications are involved?

Mr. Crossman

They wash their hands of it.

Mr. Maudling

What I am now dealing with is the decision of the British Petroleum Company, together with the Shell Company, to dispose of their interests in this marketing company. I am saying on behalf of the Government that this decision was taken as a commercial decision. The Government regard it as a commercial decision. I quite agree that it can be represented as a political decision, but it was not a political decision—and I do not think that anyone would be benefited if it were thus represented when it certainly was not. I think that my hon. Friend appreciates that.

Mr. Langford-Holt

My right hon. Friend has prayed me in aid. I said that this decision had political implications in regard to which Her Majesty's Government could not divest themselves of responsibility.

Mr. Maudling

I quite agree. All I am saying is that to go further than that and to represent this as a political decision—as it has been represented by the right hon. Gentleman opposite—when in fact I can assure him it was not, may do harm, and I do not see how it can do good. Therefore, I am very grateful for the opportunity of making quite clear once again that this was a commercial decision, reached by the companies without reference to Her Majesty's Government, and that the Government, after considering the matter, still consider it as a commercial decision, and a matter in connection with which we should apply those principles which have been applied over a long time by successive Governments in their dealings with petroleum companies.

Mr. Crossman

May I have an answer to my question about the Gulf of Aqaba?

Mr. Maudling

I do not think that that question arises on this debate. This refers to the British Petroleum Company and its marketing company in Israel.

Mr. Marcus Lipton (Brixton)

Can the Minister confirm whether the Israel authorities made an offer to the British Petroleum Company in connection with the marketing organisation? Did they ask for a review of the conditions so that the oil companies would suffer no loss in future? If there is going to be no commercial loss, that is the last reason for ending the marketing arrangements.

Mr. Maudling

I dealt with that point earlier, in reply to the hon. Member for Coventry, East (Mr. Crossman).