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The Oil Industry in Nazi Germany, 1936–1945

Published online by Cambridge University Press:  11 June 2012

Raymond G. Stokes
Raymond G. Stokes
Affiliation:
Raymond G. Stokes is a doctoral candidate at Ohio State University.
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Abstract

The oil industry in Nazi Germany provides an excellent focus for studying the interplay between economics, politics, and government policy in the Third Reich. In this article, Mr. Stokes brings to this subject a comparative approach, making comparisons both within the oil industry and with the industry's major industrial counterparts. He concludes that a variety of factors—including the degree of shared interest between individual firms and the government, the size and concentration of a firm's production facilities, and the political position of key firm personnel—explain the success as well as the eventual collapse of a given industrial sector.

Type
Articles
Information
Business History Review , Volume 59 , Issue 2 , Summer 1985 , pp. 254 - 277
Copyright
Copyright © The President and Fellows of Harvard College 1985

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References

1 Aside from the obvious political differences between the Nazi regime and that in the United States, there have been great changes in economic structure since 1945. The two cases differ in capital structure and in the amount of labor available: moreover, the German economy of 1945 depended largely on coal rather than oil. One set of figures puts this difference into clear perspective. Total world production of petroleum in 1945 was just over seven million barrels a day. In contrast, the United States alone, imported close to eight million barrels of oil a day until the oil shock of 1979, a figure that closely approximated daily gasoline consumption in the United States.

2 Figures are drawn from Friedensburg, Ferdinand, Die Rohstoffe und Energiequellen im neuen Europa (Oldenburg/Berlin, 1943), 299.Google Scholar German figures exclude Austria. Synthetic fuel production figures are not included: they would increase oil's share to about 5 percent of total energy consumption.

3 U.S. Strategic Bombing Survey (USSBS) (European War), USSBS Report 109, Oil Division Final Report (2d ed., Jan. 1947), fig. 1 (hereafter cited as Oil Division Final Report). Percentages are calculated on the basis of statistics from this figure. All USSBS figures are reported in metric tons, rather than in barrels, the more common measure today. Multiplying the USSBS figures by 7.3 will give an approximation of the number of barrels. See Lantzke, Ulf, “Expanding Use of Coal,” Foreign Affairs 58 (winter 1979–1980), 354n.CrossRefGoogle Scholar Duane Skidmore of the Ohio State University's department of chemical engineering helped me understand the conversion factor and advised me on other technical questions.

4 There is no recent study of the storage and distribution of petroleum in Germany, although the Oil Division Final Report includes a good overview. Krammer, Arnold, “Fueling the Third Reich,” Technology and Culture 19 (July 1978)CrossRefGoogle Scholar, although almost exclusively concerned with the major synthetic oil producers in Nazi Germany, includes material on other synthetic or substitute fuels (such as alcohol, Benzöl, and Treibgas), see 414. Krammer also deals briefly with imports of oil from Eastern Europe (408–9). As for the foreign activities of the German oil industry, Helmut Mejcher has begun a projected multivolume study on politics and oil in the Middle East before World War II with the very good Die Politik und das Öl im Nahen Osten, vol. 1, Der Kampf der Mächte und Konzerne vor dem Zweiten Weltkrieg (Stuttgart, 1980).

5 Nolte, Ernst, “Big Business and German Politics: A Comment,” American Historical Review 75 (Oct. 1969): 75CrossRefGoogle Scholar; Milward, Alan, War, Economy and Society 1939–1945 (Berkeley, Calif., and Los Angeles, 1977), 10–14.Google Scholar The precise nature of the relationship between German business and Nazis both before and after the seizure of power is a subject of considerable historiographical controversy. An excellent summary of the debate and the literature relevant to it is in Neebe, Reinhard, Groβindustrie, Staat und NSDAP 1930–1933: Paul Silverberg und der Reichsverband der deutschen Industrie in der Krise der Weimarer Republik (Göttingen, 1981), 9–18Google Scholar, esp. 15–18. For Neebe's own well-reasoned and well-documented analysis of these relations to 1933, see 117–26, 200–203.

6 Petzina, Dieter, Autarkiepolitik im dritten Reich: Der national-sozialistische Vierjahresplan (Stuttgart, 1968), 36, 43CrossRefGoogle Scholar; Carr, William, Arms, Autarky and Aggression (New York, 1972), 52Google Scholar; Mason, T. W., “The Primacy of Politics-Politics and Economics in National Socialist Germany,” in The Nature of Fascism, ed. Woolf, S. J. (New York, 1968), 179.Google Scholar For a more nuanced view of the chemical industry in particular, see Tammen, Helmuth, Die I. G. Farbenindustrie A.G. (1925–1933). Ein Chemiekonzern in der Weimarer Republik (Berlin, 1978), esp. 143–44.Google Scholar

7 For Nazi goals and reasoning, see the summary of Hitler's memorandum of mid-August 1936 in Petzina, Autarkiepolitik, 48–52; Rich, Norman, Hitler's War Aims: Ideology, the State and the Course of Expansion 1 (New York, 1973): 3–10Google Scholar; and Herbst, Ludolf, Der totale Krieg und die Neuordnung der Wirtschaft (Stuttgart, 1982), 36–42Google Scholar, 142–44. For the role of the Nazi reading of the causes of the German defeat in 1918 in their development of policy, see Milward, War, Economy and Society, 26–28. For support of the army, see Petzina, op. cit., 36–38, and Carr, Arms, 52–53. More recent research indicates that the Nazis and others were mistaken in attributing to raw materials shortages a key role in the German defeat in 1918. Gerd Hardach gives much more emphasis to the factors of transportation outages, coal shortage, and insufficient labor. See Hardach, , The First World War (Berkeley, 1977), 30–34.Google Scholar

8 Mason, “Primacy of Politics,” 178; Petzina, Autarkiepolitik, 45–46.

9 Mason, “Primacy of Politics,” 179.

10 Quoted in Petzina, Autarkiepolitik, 43.

11 Ibid., 40; Rich, Hitler's War Aims, 68–69.

12 Schweitzer, Arthur, Big Business in the Third Reich (Bloomington, Ind., 1964), 537–47Google Scholar; Carr, Arms, 62.

13 Mason, “Primacy of Politics,” 180. Wages remained low in the German coal industry even though coal production was essential to German war production because the coal industry had little political power and did not deliver directly to the armed forces.

14 Petzina, Autarkiepolitik, 45.

15 Combined Intelligence Objectives Subcommittee (CIOS) Final Report 10 xxxii-94, “German Petroleum Industry, Hamburg District,” 12–27 May 1945; E. H. Bower, report 13, “Reichsinstitut für Erdölforschung der Technische Hochschule Hannover,” 1, in box 11/27–1, Office of Military Government for Germany (U.S.), Headquarters, Legal Division, Decartelization Branch, RG 260, Washington National Records Center, Suitlands, Md. (hereafter WNRC).

16 U.S. Strategic Bombing Survey (European War), USSBS Report 113, The German Oil Industry, Ministerial Report Team 78, see. 1.05, 14–15, and sec. 1.08, 30, in Records of the U.S. Strategic Bombing Survey (European War), RG 243, National Archives, Washington, D.C. (hereafter NA). (This report is cited hereafter as German Oil Industry.) See Krammer, “Fueling,” 408–9, for imports from eastern Europe and German exploitation of oil from that area.

17 British Intelligence Objectives Subcommittee, BIOS Final Report 1017, Oil Fields Investigation, pt. 4, sec. 2, The War Structure of the German Crude Oil Industry 1934–1945, Private Industry (London, n.d), by A. E. Gunther, 2–3a (hereafter cited as BIOS 1017, War Structure).

18 USSBS 113. German Oil Industry, sec. 1.07, 19.

19 Ibid., sec. 1.07, 20; USSBS 109, Oil Division Final Report, 14.

20 Hughes, Thomas Parke, “Technological Momentum in History: Hydrogenation in Germany 1898–1933,” Past and Present 44 (Aug. 1969), 127.CrossRefGoogle Scholar

21 BIOS 1017, War Structure, 3c.

22 “Oil Investments and Holdings of Oil Companies,” 1, in OMGUS Headquarters, Economies Division, Decartelization Branch, Box 17/235–3, RG 260, WNRC.

23 USSBS 113. German Oil Industry, sec. 2.07, 47–48; USSBS 109, Oil Division Final Report. 21.

24 Ibid.

25 FIAT Final Report 403, “Report on the German Economic Situation, 1943/44,” trans., prep., and ed. by H. R. Habicht and Walter Jessel, 8, in (Army Staff) Intelligence (G-2) Library “P-file,” 1946–51, entry 82, box 499, RG 319, WNRC; USSBS 113, 48; USSBS 109, appendix B, 21.

26 BIOS 1017, War Structure, 3a; Hughes. “Technological Momentum,” 127; USSBS 109, 15; USSBS 113, sec. 1.07. 21, and Table 8.

27 BIOS 1017, War Structure, Appendix 2A, “Report on a Visit to the North German Oil Fields,” by R. K. Dickie and A. E. Gunther (21 May 1945), 69–74; ibid., Appendix 2B, “Supplement to Report on a Visit to the North German Oil Fields,” (9 June 1945), 75–78.

28 Birkenfeld, Wolfgang, Der synthetische Treibstoff 1933–1945 (Göttingen, 1964), chap. 4, esp. 62.Google Scholar

29 USSBS 113, German Oil Industry, sec. 2.04, 44, and sec. 2.07, 48; British Intelligence Objectives Subcommittee, BIOS Final Report 1911, “Major Developments in Synthetic Lubricants and Additives in Germany,” by H. L. West (London, n.d.). 75–76, 92–93.

30 Quoted in British Intelligence Objectives Subcommittee, BIOS Final Report 513, “Notes on the Organization of the German Petroleum Industry during the War,” by W. H. Thomas and J. G. Withers (1–31 Oct. 1945), 1–15, (Army Staff) Intelligence (G-2) Library “P-file,” 1946–51, RG 319, WNRC; Office of Strategic Services, Research and Analysis Branch, R&A Report 1917, “Draft of Section for German CAD Guide on Oil” (18 May 1944), 2–3, Records of the Office of Strategic Services RG 59, NA. See also organizational chart in USSBS envelope 110.d. 108, “Government Control Instruments of the German Oil, Chemical, and Rubber Industries,” Records of the U.S. Strategic Bombing Survey (European War), RG 243, NA.

31 Hughes, “Technological Momentum,” 120; USSBS 113, German Oil Industry, sec. 1.08, Table 15, 31, and sec. 2.04, 43–44.

32 A modified version of the Fischer-Tropsch process is used in the synthetic oil plants of South Africa, the country with the largest synthetic fuel production in the world today.

33 USSBS 113, German Oil Industry, sec. 1.03, 10–11.

34 Ibid., 9–10.

35 Ibid.; Hughes, “Technological Momentum,” 108–20. Gottfried Plumpe, in a recent article, takes issue with Hughes and stresses business strategic factors rather than technological momentum in explaining the I.G. decision to develop synthetic rubber. Plumpe's article actually complements rather than disproves Hughes's argument, however. See Plumpe, , “Industrie, technischer Fortschritt und Staat: Die Kautschuksynthese in Deutschland 1906–1944/45,” Geschichte und Gesellschaft 9 (1983): 564–97, esp. 572–73.Google Scholar For the role of Standard Oil of New Jersey, see Joseph Borkin's engaged but well-documented book. The Crime and Punishment of I. G. Farben (New York, 1978; Pocket Books ed., 1979), 60–61, 64–65; see also Tammen, I. G. Farbenindustrie, 102–3.

36 Hughes, 120ff; USSBS 113, German Oil Industry, sec. 2.04, 43, and sec. 1.08, Table 15, 31.

37 USSBS 113, sec. 108, Table 15, 31, and sec. 2.07, 48.

38 British Intelligence Objectives Subcommittee, BIOS Report 1697, Synthetic Oil Production in Germany: Interrogation of Dr. Bütefisch (London, n.d.), 2.

39 Ibid., Table 1, 14, and explanation of Table 1, 15.

40 USSBS 113, German Oil Industry, sec. 2.07, 48.

41 “Synthesegas aus Braunkohle,” Chemische Industrie 59 (May 1936), 106; Tammen, I. G. Farbenindustrie, 37.

42 BIOS 1697, Synthetic Oil Production, 15.

43 Ibid.; USSBS 113, German Oil Industry, sec. 1.06, 16.

44 BIOS 1697, 5; BIOS 513, Notes, Chart A; organizational chart, in envelope 110.d.108, BG 243, NA.

45 Quotation taken from organizational chart in envelope 110.d.108, RG 243, NA; Borkin. Crime and Punishment. 84.

46 Petzina. Autarkiepolitik. 44; Borkin, 90.

47 Borkin. 92–94; USSBS 109. Oil Division Final Report. 22; Milward, Alan, The German Economy at War (London, 1965). 20.Google Scholar

48 USSBS 109. 1; see also Birkenfeld. Treibstoff. 191.

49 U.S. Strategic Bombing Survey, USSBS Final Report 134, Overall Economie Effects Division Final Report. 17, Records of the U.S. Strategic Bombing Survey, (European War). RG 243, NA.

50 Percentages calculated from figures in USSBS 109, Oil Division Final Report, 23.

51 For transportation systems outages, see U.S. Strategic Bombing Survey (European War), USSBS Report 2 (30 Sept. 1945). 64, and Milward, German Economy, 173. Arnold Krammer contends that “the bombing raids destroyed the German fuel network not by crippling production hut by causing a complete breakdown of transportation” (see Krammer, “Fueling,” 418). It is more accurate to say that both effects of the bombing—crippled production combined with transportation breakdown—contributed to the downfall of the industry. Krammer himself admits, for instance, that high-octane fuel production fell because of production losses brought on by the bombing, and Bütefisch claimed that “the actual bombing of the [synthetic oil] plants was far more important” than transporation outages. (See BIOS 1697, Synthetic Oil Production, 6.) American technicians in Germany after the war estimated that it would take at least a year (until June 1946) to restore synthetic production, because of damage to the plants. See D. M. S. Langworthy to members of the Army-Navy Petroleum Board, 24 May 1945. Records of the War Department General and Special Staffs, CAD 463 (6–1–43), sec. 2, RG 165, NA.

52 USSBS 109. Oil Division Final Report, 23.

53 Speer, Albert, Inside the Third Reich (New York, 1970; Avon books edition, 1971), 446–47.Google Scholar

54 USSBS 109, Oil Division Final Report, Table 11, 24.

55 Ibid., 23.

56 South Africa's synthetic production is about 2.2 million metric tons a year, whereas Germany was producing synthetic petroleum in 1944 at an annual rate of about 4.3 million metric tons (estimated on the basis of production in the first four months of that year).