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Tuesday, 25 October 1949

Mr LANG (REID, NEW SOUTH WALES) - I ask the Prime Minister whether petrol that is obtained from Indonesia is regarded as having a dollar content. Has the Government explored the possibility of reaching a trade agreement with Indonesia to increase petrol supplies from that country to Australia, in return for increased exports of Australian goods? What would be the total dollar expenditure involved in an increase of Australia's petrol consumption, to bring the total up to 500,000,000 gallons a year? Is the Government yet in a position to release details of actual dollar expenditure on petrol showing what proportion is profit for producing companies operating in non-dollar countries ?

Mr CHIFLEY - No difficulty exists in the making of arrangements with the Indonesian Government for the supply of petrol from Indonesia. Two companies are at present engaged in producing petrol in Indonesia. One is the Vacuum Oil Company Proprietary Limited, which is an entirely Americanowned organization. Petrol obtained from that company would have a 90 per cent. dollar content. The company is also a very large producer of petrol in Sumatra. The Shell Company also produces petrol in Indoneisia,but not in the quantities produced by the Vacuum Oil Company Proprietary Limited. I understand that the Shell Company will also produce petrol at Balikpapan in the near future. It is not necessary for the Government to make arrangements with the Indonesian Government or the Dutch Government for the supply of petrol produced by those companies because the companies themselves determine where they will send their petrol. I understand that most of the output of the Vacuum Oil Company Proprietary Limited in Indonesia comes direct to Australia at present. No difficulty exists in obtaining tankers for the shipment of Indonesian petrol to Australia. A long and detailed answer would be necessary to cover the matters raised by the other questions that the honorable member has asked. All I can say is that it is calculated that all petrol that is produced in the sterling areas is 60/40 petrol. It is calculated by the Bank of England, which is aware of all the facts in relation to this matter, that 40 per cent. of all "petrol produced in the sterling areas must be paid for in dollars. I have already said that the annual dollar commitment of the sterling area is approximately 400,000,000 dollars. That is a considerable under-estimate of the dollars that have to be found by the sterling pool for all goods required from dollar countries. I shall examine the honorable member's questions in order to ascertain whether there is any further information that I can give him on the subject. One of the best indications of the dollar content of petrol will be provided by the decision on the price of petrol which is to be made in London, if not. to-day, then in the near future, as the result of the devaluation of sterling and of the Australian £1 in relation to the dollar. A price rise is anticipated over the whole field of petrol supplies, irrespective of whether they come from the sterling area or otherwise. The honorable member for Brisbane asked me a little earlier whether Ampol had drawn on defence petrol stocks. The answer is " No ". That company has not broken the lawin regard to defence stocks.

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