Mr. Churchill explained and defended the Government's agreement with the
Anglo-Persian Oil Company in the Commons on Wednesday. His speech, which lasted an hour and a half, was in great measure an expansion of the Admiralty Memorandum ; but Mr. Churchill was careful to explain that we were not depending exclusively or primarily on the Persian oilfields, but intended to draw leas than half our supply from that source. The main reliance of the Navy would still be on Welsh coal, but oil had become a naval necessity owing to the large number of vessels built on an oil basis. The State-owned supply which they had now secured not only ensured an abundant supply of oil of good quality, but placed the Admiralty in a controlling position in regard to price. Tho Admiralty were now forced to pay more than double what they paid for oil a few years ago. Some of this increase was due to the greater demand, but there had been "a long steady squeeze by the Oil Trusts all over the world." The policy, he added, had been suggested by Mr. Pretyman when be was at the Admiralty eleven years ago, and was the outcome of careful and prolonged investigations. Mr. Churchill con- tended that they had made an excellent bargain; and explained that the £2,200,000 invested by the Government would not be used in buying out existing shareholders, nor in payment for goodwill and commissions, but would be employed for the actual development of the oil supply, and would bring in new properties and new assets.
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