Oil War

Germany's ministers to all the Balkan nations were mobilized last fortnight in Berlin, on the eve of this week's meeting of the Balkan Entente in Belgrade. The crisis of one of the decisive battles of the War was at hand -- a battle for the raw materials of the Balkans.

Rumania is already a battleground, between Germany and the Allies, over oil. Professor Gheron Netta, head of Rumania's Economic Institute, was appointed oil "dictator" to try: 1) to fulfill Rumania's promise of last December to send Germany 1,560,000 tons of oil in 1940; 2) to keep the Allies (whose nationals, together with Belgian, Netherlands and U. S. capital, own 80% of Rumania's oil production) pacified while this is going on. Sir Reginald Hoare, British Minister at Bucharest, applied Allied pressure, warning Professor Netta et al. with grim politeness that Germany's quota of Rumanian oil must on no account be increased, least of all out of wells developed by Allied money. Professor Netta et al. replied that Germany's quota would not be increased, but the decline in Rumania's oil production must be stopped and reversed.

Germany's contract calls for about 300 tank cars per day out of Rumania. On good days the shipments have exceeded 400 cars, but only to make up for far more numerous bad days when no cars go at all. The average is probably not above 100 cars per day. Reasons: 1) a shortage of rolling stock (Germany, whose own rolling stock is in very bad condition, is extremely slow in returning Rumanian cars); 2) shortage of coal from Germany to stoke the engines; 3) sabotage and inefficiency along the 170-mile stretch of railroad from Oraseni, on the Rumanian border of old Poland, where Rumania hands over the oil, to Jaroslaw in German-occupied Poland. Pretty well confirmed last week was the fact that German troops, reported moving last fortnight into this part of old Poland (TIME, Jan. 29), were there primarily to operate and police this trackage. Paris heard a less likely story that Russia had given Germany, in return for technological help against Finland, a new "Polish Corridor" 40 miles wide, straight through to the Rumanian border. There was even a report that Germany might build a pipeline.

Adolf Hitler's economic field general, Dr. Karl Claudius, proceeded last week from Bucharest, where he put the fear of Gott into Professor Netta, to Rome, where he courted support of Germany's campaign for Rumanian oil by promising Italy a larger share thereof. He had also to work out a solution for Italy's coal shortage, which by now is so grave that imported coal and coke may no longer be used for heating houses. Of the 12-13,000,000 tons of coal Italy imported, most came by sea from Germany. The Allied blockade cuts this off and Germany's wartime railroads are incapable of transporting even the 4,500,000 tons she might spare for Italy in 1940. The shift of Italy's coal purchases to Great Britain would be a potent lever to bend the famed Rome-Berlin Axis. Meantime Franz von Papen, Nazi Ambassador to Turkey, carried the economic war into territory which the Allies thought they had nailed down. After a five-month breach of trade relations with what used to be her best customer, Turkey announced a trial treaty with Germany for the exchange of $6,000,000 worth of goods over an unspecified time. Turkey will send cotton, wool, fruit, in exchange for German chemicals and other manufactures, probably including munitions.

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