Jonathan Morales December 18, 2012

World War II on the Eastern Front

Oil and World War II on the Eastern Front

The Nazis' bid for a European empire was as much a conquest for raw materials as it was an

expansion of 'race and space.'1 Among the raw materials that the German leadership hoped to

plunder was oil, a resource that Germany lacked. Germany's shortage of oil and the Nazis' quest

to achieve oil security affected the course of the war and was a contributing factor in the ultimate

collapse of the Third Reich. Tracing and analyzing Nazi oil policy furthermore illustrates how

Nazi ideology, combined with hubris and wishful thinking, affected the way Nazi leadership

pursued practical objectives.

Autarky and Oil

Few nations are blessed with sizable domestic oil reserves. Germany had coal, and it

was through hydrogenation, a process by which coal is converted to synthetic liquid fuel,

that the Third Reich hoped to reduce and eventually eliminate its reliance on foreign oil

imports.2 Hydrogenation was capital-intensive and expensive, but there were economic

reasons in favor of reducing oil imports, the most important being the unfavorable

balance of trade created by importing German oil needs. Furthermore, petroleum

supplies were vital to a functioning economy and military, and relying on imports to

1 Mazower, Hitler's Empire, 259.

2 Hydrogenation, or the Bergius process, is the process by which hydrogen is added to coal under high temperture
and pressure with a catalyst. Another process for generating synthetic fuel from coal was the Fischer-Tropsch
process, by which coal molecules are broken down into hydrogen and carbon monoxide, which react together to
produce synthetic fuel. The Bergius process and the Fischer-Tropsch process yielded different refined products.
The Bergius process could produce high-grade aviation fuel, while the Fischer-Tropsch process could not, and
therefore the hydrogenation plants were greater in number and relative importance than Fischer-Tropsch plants.

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meet fuel needs put Germany in a strategically precarious position. Nazi ideology,

which equated independence and its brand of German exceptionalism with economic

self-sufficiency, or autarky, also played a role in promoting hydrogenation as a viable

alternative to foreign oil imports.

The basic technology for hydrogenation was developed before the First World

War, but the ability to produce usable fuel was elusive. German scientists were the most

active in the application of hydrogenation to producing synthetic fuel. In 1925, the

Weimar Republic expressed interest in supporting hydrogenation for economic reasons,

as oil imports strained the German balance of trade. The Defense Ministry also

supported aid for a synthetic oil industry, calling the project “of utmost importance” to

German defense interests.3

The private sector, however, showed little enthusiasm for the risk of

commercializing hydrogenation. The start up costs were high, and capital was scarce.

Oil companies were dissuaded by the low cost of natural crude prices, compared with

the high projected cost of synthetic production. IG Farben, a conglomerate of chemical

companies formed during World War I, took the plunge and opened its first synthetic

fuel plant in 1927, with heavy support from the state. The military urged expansion of

the industry, viewing cost as no factor. The Reichwehr, the provisional defense force

allowed under the Treaty of Versailles, advocated in 1930 a large scale expansion of

synthetic fuel plants, along with plants to produce synthetic rubber and fibers. 4

3 Goralski et al, Oil and War, 17.

4 Goralski et al, Oil and War, 17-19.

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Even with Weimar's support for its nascent domestic hydrogenation industry,

Germany was hardly immune from the developments of the international oil market.

The Great Depression and the drop in demand for oil in the 1930s, combined with

massive new oil discoveries in Texas, made hydrogenation an even worse investment as

international oil prices plunged. Leunabenzin, the synthetic motor fuel produced at IG

Farben's Leuna plant, cost up to ten times as much as Rumanian or American imports. 5

Weimar tried to keep synthetics commercially viable by imposing a tariff on barrels of

crude equal to twenty-five times the 1933 sale price of Texas crude.6

The National Socialist Party vehemently criticized IG Farben for being the

exploitative instrument of the ten “money-might Jews” sitting on the company's

governing board, and for the monopoly it held on the thus far unprofitable synthetic fuel

program.7 In 1932, two IG Farben officials met with Adolf Hitler, in hopes of convincing

him to call off the party's negative press campaign. The discussion was supposed to be a

half-hour presentation, but turned into a two-and-a-half hour speech, as Hitler grew

excited and assured the executives that synthetic oil, with its promise to end reliance on

foreign oil, fit perfectly into his vision for Germany: “Today, an economy without oil is

inconceivable in a Germany which wishes to remain politically independent. Therefore,

German motor fuel must become a reality, even if this entails sacrifices. Therefore, it is

urgently necessary that the hydrogenation of coal be continued.” Hitler promised to halt

the smear campaign against IG Farben and to keep the protective tariffs in place. IG

5 Yergin, The Prize, 314.

6 Goralski et al, Oil and War, 19-20.
7 Hayes, Industry and Ideology: IG Farben in the Nazi Era, 65.

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Farben, in return, removed a few Jews from its top ranks and pledged a generous

campaign contribution to the Nazi Party.8

IG Farben's synthetic fuel program benefited immediately from the Nazi Party's

takeover of power in 1933. In September, the Reich provided a subsidy to IG Farben

and guaranteed markets by setting prices well above market value. In 1934, the

government began a program for storing a distributing synthetic fuels, strategically

placing storage facilities and implementing a transport network to supply military

need.9

Developments abroad further encouraged the cultivation of domestic synthetic

fuel production. Shortly before Germany remilitarized the Rhineland, Fascist Italy

invaded Ethiopia. The League of Nations debated economic sanctions in response,

including a total embargo on oil. Like Germany, Italy possessed no significant domestic

oil reserves. In the end, the economic sanctions did not include oil. Had the League

enforced an oil embargo on Italy, Mussolini complained, he would have had to withdraw

“in a week” for lack of fuel, and the invasion would have been “an incalculable disaster.”

The possibility of embargo was a real threat, and the Allied blockade of Germany was

engrained in the historical memory of the First World War. To many Germans, Hitler in

particular, the surrender of 1918 was caused not by battlefield defeat, but by lack of food

and fuel.10 As the Earl Curzon famously summed up in 1918, the Allied cause “floated to

8 Yergin, The Prize, 312; Goralski et al, Oil and War, 21.
9 Goralski et al, Oil and War, 22.
10 Goralski et al, Oil and War,15

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victory on a wave of oil.”11

In September 1936, Hitler unveiled the Four-Year Plan, demanding “to advance

Germany’s motor fuel production with all possible speed and achieve self-sufficiency

within eighteen months.”12 This plan included ten new hydrogenation plants, that could

triple production by 1938. For Hitler, the question of “production costs” of raw

materials was “of no importance.” Shortly thereafter, the Reich doubled the import tariff

on crude oil.13 The resignation of Dr.Hjalmar Schacht, who, as head of the Reichsbank

and acting Minister of Economics, opposed rearmament and Hitler's autarkic policies

because they were unjustifiably expensive, further established the position of the state-

backed synthetic fuel industry. His replacement by Commander of the Luftwaffe

Herman Göring's as Economics Minister, a staunch supporter of building up the

domestic synthetic oil industry, suggests that Nazi support for autarky was based not

only on the grounds of economic necessity, but for political and rearmament purposes.

It was in the spring and summer of 1938,with the prospect of war looming, that

experts in the Four Year Plan Office revised the overoptimistic targets for fuel self-

sufficiency set in 1936. Göring approved in July 1938 the New War Economy Production

Plan, which called for concentrating efforts on items vital for the war effort: synthetic

rubber (Buna), light metals and gunpowder, explosives, poison gas, and petroleum.

Mobilization fuel requirements were also recalculated based on the conflicts that

preceded War War II in Ethiopia, Spain, and the Far East. Specialists in the New War

11 “Floated to Victory on a Wave of Oil” in The New York Times, November 23,1918.
12 Hitler quoted in Eichholtz, Oil and War, 2.
13 Goralski et al, Oil and War, 25.

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Economy Production Plan office drastically increased the Wehrmacht's 1936 estimate of

fuel needs from 5-6 million tons annually to nearly 14 million tons, increasing yearly to

nearly 24 million tons annually by 1942.14

By the final years of the interwar period, Germany was less dependent than ever

before on oil imports. In 1940, synthetic fuel was meeting nearly half of German

consumption needs, producing 72 thousand barrels of oil per day. 15 IG Farben officials

assured the Reich, without qualification, that German fuel supplies could eventually be

met wholly through hydrogenation of coal. Investment in synthetic oil was beginning to

pay off, as the cost of synthetic liquid fuel narrowed to a more manageable level of 1.5 to

2 times that of imported refined oil products.16 A year before Germany's invasion of

Poland and the start of the Second World War, Hitler announced that the policy of

autarky, pursued without concern for short-term cost, had overturned the possibility of

blockade as an effective weapon against Germany:

[The] German economy is being so constructed that at any time it can be completely independent
from other countries and stand on its own feet. And this is succeeding. The idea of blockading
Germany can even now be buried as an entirely ineffective weapon. The National Socialist State,
with the energy that is peculiar to it, has drawn conclusions from the lessons of the World War.
And now, as before, we hold to the fundamental principle that we would rather limit ourselves in
this or that field should it become necessary in order to make ourselves independent from foreign
countries. Above all, the following decision always will stand at the top of our economic actions:
security of the nation goes ahead of everything else. Its economic existence is, therefore, to be
secured materially in its fullest measure with our own standard of life and our own living space.
For only then can the German army be in a position at all times to take freedom and interests of
the Reich under its protection.17

While Germany was by fall 1938 less dependent on foreign imports than it was during

World War I, it was still vulnerable to foreign attacks on its fuel sources. First, during
14 Eichholtz, Oil and War, 3-4.
15 Yergin, The Prize, 316.
16 Eichholtz, Oil and War, 24.
17 Adolf Hitler, September 1938, quoted in Eichholtz, Oil and War, 15.

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peacetime, Germany still imported over half of its fuel. Mobilization of a navy and

mechanized army—particularly the combined motor and air power necessary to carry

out blitzkrieg—would greatly increase consumption, which was already growing at an

exponential rate. Fuel self-sufficiency may have been possible with more time and

greater investment, but at the start of World War II, it had not been achieved. Second,

imports came not only from Rumania and the Soviet Union, but also the United States,

Venezuela, the Dutch East Indies, and Mexico. These New World trade routes were

especially vulnerable to disruption. Third, the synthetic fuel plants themselves were

conspicuous, easy targets for air raids in the event of war. The Allies specifically

targeted synthetic fuel plants for strategic aerial bombing later in the war. Even with

enormous investments in hydrogenation to attain autarky, fuel supplies remained the

“Achilles heel” of the Third Reich.18

The Nazis' Quest for Oil Abroad

Nazi politics of expansion to accommodated both its ideological belief that the “tightly

packed racial core” of Germany was unfairly corralled into too little space, and that

participation in the world economy would weaken the German state. Concluding that

the possibilities for self-sufficiency in raw materials—including oil—were “limited,”

Hitler decided as early as 1937 to acquire Austria and Czechoslovakia. 19 Anchlusss in

March 1938 added the newly-discovered Austrian oil fields in the Vienna Basin, which

18 Mazower, Hitler's Empire, 290.

19 See the Hossbach memo.

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was particularly welcome because of the field's physical proximity to Germany. The

Germans quickly increased production, from 57 thousand tons of crude in 1938 to 1.1

million tons in 1943.20 Also, the seizure of the Sudetenland from Czechoslovakia later

that year provided the Reich with a rich deposit of lignite, a coal that was particularly

suitable for synthetic fuel production.21

When Nazi Germany attacked Poland in September 1939, following behind the

front lines was the 'Galicia Petroleum Commission,' which made a rapid dash to the

Galician oil fields in southeastern Poland. However, the Molotov-Ribbentrop Line

divided the field, and Germany took only the westernmost part, which produced a half

million tons of crude per year, or just over a quarter of the field's total production. The

seizure of the field was quick enough that facilities survived mostly intact. Nonetheless,

inefficient extraction methods by the 350 separate industries operating in West Galicia

meant that the Germans could only maintain prewar production capacity. It was not

until the failure of the 1942-1943 assault on the oil-producing regions in the South

Caucasus that the Germans replaced the inefficient extraction methods with a more

long-term strategy.22

On the Western Front, the Germans captured the oil field in Alsace, but its

production was small—scarcely a tenth of production captured in the German-

controlled sector of Galicia. Of far greater importance, though, were the stockpiles of oil

that German plunder units captured from storage tanks and refineries, including 1

20 Eichholtz, War for Oil, 9.

21 Overy, Why the Allies Won, 230.
22 Eichholtz, War for Oil, 12-13.

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million tons in France and and half million tons in the Netherlands. Plundered oil from

France and the Netherlands more than replaced the oil spent in the Western Europe

campaign.23

Aside from the Soviet Union, Rumania was a critical source of petroleum for

Germany, but Germany's position there was precarious because German investment

accounted for only .2% of total oil-invested capital. Between 1938 and 1941, new

developments allowed the Germany to pull Rumania, and its crucial oil industry, closer

into its orbit. German economic power, its aggressive annexation of Austria and division

of Czechoslovakia, and its victory over Poland certainly added pressure to cooperate. In

May 1940, Germany reached an agreement with Rumania to swap German arms for

Rumanian oil at a significant discount. By 1941, Rumania was exporting over half its oil

to Germany, about 3.6 million tons per year.24 Nazi leaders were convinced that, with

encouragement, Rumania could double its oil output. However, it was no secret to those

who were better informed that Rumanian fields were on the decline after 1936. As it

turned out, refinery yields failed to live up to Nazi standards, as refinery output steadily

declined between 1939 and 1943, in which year output achieved only 45% of fulfillment

of Nazi plans.25

The decision in late 1940 to invade the Soviet Union was made amidst vacillation

among policymakers about how to proceed. Some scholars suggest that securing the

Soviet Union's extensive oil reservoirs was a decisive factor in Hitler's determination to

23 Eichholtz, War for Oil, 15.

24 Eichholtz, War for Oil, 22-23.
25 Pearton, Oil and the Romanian State, 259-263.

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invade.26 In fact, fuel was probably among the strongest arguments not to invade. Even

after Directive 21 was issued in December 1940, which called for preparations to be

made to invade the U.S.S.R. by no later than May 1941, economic and military experts

were still unclear on how the Wehrmacht was going to be able to fight its way to the

South Caucasus with only weeks worth of fuel stockpiled.

When, in November 1940, Herman Göring told head of War Economy and

Armaments Department Georg Thomas of the impending opening of an eastern front,

Thomas was unambiguous in pointing out the risks to Germany's fuel supply posed by

such an undertaking, calculating that:

Aviation fuel sufficient until fall 1941, assuming a maximum consumption of 150,000 tons
during the main months of combat. Motor fuel assured only for the march-up and a maximum of
two months' combat, after August supplies exhausted; supplies then only from own production
and imports (Romania, possibly Baku [!]). . . same situation in the diesel fuel sector where
supplies exhausted after mid-August. Heating oil until fall.27

Two weeks later, Thomas reported to Göring that the eastern front “could only be

supplied with fuel for only two months.” Göring replied to Thomas in agreement, but

rather than questioning the sanity of invading the U.S.S.R. with such perilously low fuel

supplies, Göring assured Thomas that the “Baku oil-producing region, too, had to be

seized at all costs.” Göring further argued that once the German forces launched their

attack, the “entire Bolshevik state will collapse,” so there should be no reason to suspect

26 Daniel Yergin, for example, considers the issue of oil a major factor in Hitler's decision to invade the Soviet
Union (Yergin, The Prize, 317). Indeed, there are some suggestions from high-level sources that Hitler did
consider oil as a factor. Albert Speer told interrogators that “the need for oil certainly was a prime motive” in
deciding to invade the Soviet Union (USSBS, “Oil Division Final Report,” 36-39). Given Hitler's apparent
ignorance of the severe risk that Germany faced in opening a second front with no greater than a four-month
supply of petroleum products stockpiled, it would seem odd that the logistical consideration of oil played
anything more than a secondary role in the initial decision.
27 Georg Thomas on February 8, 1941, quoted in Eichholtz, War for Oil, 36.

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the Soviets would destroy of oil facilities. Finally, Göring informed Thomas that he

planned to “meet with Antonescu” to convince him “to have our Romanian [oil] resource

base expanded even more quickly.”28

Hitler read Thomas' reports with rage, calling his insufficiently optimistic

appraisals “defeatist reports” and “pure fantasy.”29 Initially, Hitler and Göring's

assumption that the war would end in a matter of weeks seemed justified, as the

Germans quickly drove back the disorganized Soviet forces. 30 However, there were early

signs that Nazi leadership had fatally miscalculated supply needs, as vehicles burned

twice as much fuel as expected on tough Russian terrain and large vehicles sank into

unpaved roads. Warnings of fuel shortages went ignored amidst more welcome news of

early victories.31

Bogged down in mud and snow, the Wehrmacht only reached the outskirts of

Moscow in fall 1941, and by then, critical time had been lost. The Luftwaffe was

increasingly being grounded for lack of fuel, leaving infantry and panzer divisions

exposed. Not only quartermasters, but commanders also complained of the “wretched

state of our fuel supplies.”32 As winter set in, engines seized, gasoline froze, and

lubricating oil turned into a thick tar. By then, both German soldiers and Nazi

28 Georg Thomas and Herman Göring quoted in War for Oil, 36. The assumption that the Soviet state would not
survive the initial assault was widespread. Of the eastern war, Hitler boasted that “we'll kick the door in and the
house will fall down” (Yergin, The Prize, 318).
29 Hitler quoted in Goralski et al, Oil and War, 53.
30 Adolf Hitler believed the war would be over in three weeks; Field Marshall Walther von Brauchitsch predicted
that major operations would be over within four weeks. Georg Thomas himself believed a quick war was
possible and in fact necessary to prevent the destruction of Soviet fuel stores and infrastructure and to solve the
issue of transporting oil and supplies to and from the South Caucasus (Goralski et al, Oil and War, 55).
31 Yergin, The Prize, 318.
32 Goralski et al, Oil and War, 81-82.

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policymakers alike had awakened to the reality that a quick victory was beyond reach.

If the Russo-German war was not a war for oil in 1941, it was by 1942. The issue

of oil supplies had become a pressing enough that it was the oil-rich Caucasus, and not

Moscow,33 that became the Nazis' priority in the Soviet Union. In an attempt to “seize

the initiative again,” Hitler ordered that the northern front be extended to meet the

Finns, the central front to stand ground outside Moscow, while the southern flank broke

through the Caucasus specifically to “secure the Caucasian oil fields.” 34

The thrust towards the Caucasian oil fields began in late July 1942. The line was

to move over 200 miles to reach Maikop, and 750 miles to reach Baku, a city literally

swimming in oil. Panzer units reached the nearest installations in Maikop in the second

week of August. For Nazi leadership, it was critical that the oil fields be captured with

minimal damage so that oil could quickly be extracted. Hitler even entertained the idea

of using a local coup to capture the oil facilities, employing insurgents disguised in

Soviet uniforms. Paratroops were supposed to land in order to keep the element of

surprise.35 But when the technicians from the 'Oil Brigade' examined the fields, they

reported back that the Maikop fields were “as thoroughly scorched as an oil field can

be.” The Soviets had demolished everything, pouring concrete into the wells and

destroying even the small hand tools in workshops. Restoration of the fields to

producing condition was difficult enough, but the task of the Oil Brigade was toughened
33 In August, Hitler briefly shifted the war strategy from attacking Moscow to seizing the Crimea (which Hitler
believed could be used as a staging ground for air assaults on Ploesti) and the industrial region on the Donets,
and to sever the Soviet oil supply from the Caucasus (there seems to be no indication that Hitler intended on co-
opting Caucasian oil). The führer later changed his mind.
34 Directive No. 41, April 5, 1942.
35 Eichholtz, War for Oil, 95-96.

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by heavy resistance from Russian partisans, who repeatedly infiltrated and blew up

installations. Logistical problems also hampered repairs, as the roads and bridges into

Maikop could not accommodate the largest vehicles. 36

On November 21, oil production in Maikop resumed under Nazi control, just as

the Red Army completed its encirclement of Stalingrad. Production was pathetic.

Experts believed that Maikop could perhaps produce 6 to 10 thousand barrels per

month, and that production could expect to reach 50 to 70 thousand tons per month

only by the end of 1943. In reality, the Germans probably produced no more than a

thousand tons of oil, because already by late December 1941, the Wehrmacht was

pushed back from Maikop. In January, the oil fields were evacuated of personnel, and

what equipment could not be packed and shipped was detonated. 37

The reversal of Nazi Germany's invasion of the Soviet Union at Stalingrad

marked the greatest extent of German imperialism and the turning point of Nazi

Germany's quest to exploit foreign oil. Like Japan, Germany had gambled on its ability

to achieve oil security by conquering a foreign source of oil before its stockpiles

depleted. Unlike Japan, Germany failed. The Germans did not conquer the ultimate

prize of the oil fields at Baku, nor were they able to bring the field that it did conquer—

Maikop, a field that was already in terminal decline—to a level of production that would

justify the cost. Furthermore, with an overextended front and an overextended baggage

train, the Nazis could only defend their unproductive field for a matter of weeks before

36 Goralski et al, Oil and War, 182-183.

37 Eichholtz, War for Oil, 97-100.

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losing it to the Red Army. With the prospects of exploiting foreign oil dissipating, the

Nazis returned to hydrogenation to supply Germany's oil requirements.

Western Aid to the U.S.S.R.

At first glance, petroleum shipments to the Soviet Union under Lend-Lease appear

paltry. Of all refined petroleum products shipped through Lend-Lease (including fuel,

lubricants, and additives), only 5% went to the Soviet Union—compared with the 74%

that went to Great Britain.38 However, comparing such broad statistics downplays the

importance of the aid that was delivered. Much of American Lend-Lease aid was highly

specialized materiel and equipment that was more important to the Soviet war effort

than their weight or number alone would suggest.

Unlike the Axis powers, the Soviet Union never experienced a major fuel crisis,

with the exception of an anxious moment in late 1942 when the German Army took the

decaying Maikop fields and threatened the more productive Baku fields. Operational

and regional shortages of fuel were more a result of logistical problems, not supply

problems. The issue for the Soviet Union was not quantity, but quality of oil. Although

the entire refining capacity of the Soviet Union immediately before and during the

Second World War was imported from the West or designed using Western

technology,39 Soviet refineries were dated and in poor repair, and could not produce

high-quality fuel or lubricants. Of the nearly 3 million tons of petroleum products

38 Tuyll, Feeding the Bear, 154.

39 Sutton, Western Technology and Soviet Economic Development, 1930-1945, 81-86.

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delivered to the Soviet Union, nearly half was high-octane aviation fuel and over a

quarter was specialized blending agents.40 Throughout the entire course of the war, the

U.S.S.R. imported approximately a quarter of its aviation fuel through Lend-Lease, 41 but

at the peak of Lend-Lease deliveries, aviation fuel shipments was equal to one-and-a-

half times that of domestic Soviet production.42

The petroleum data also does not show the extent of equipment transferred to the

U.S.S.R. through Lend-Lease, which included three complete, modern refineries, an

aviation lubricant plant, and two desalting and dehydration plants. 43 Deliveries of

petroleum cracking equipment was estimated to be able to increase the output of high

octane aviation fuel from 110,000 metric tons in 1941 to a maximum of 1.67 million

metric tons in 1944 (the U.S. Office of Strategic Services estimated this to have

represented 20% of Soviet cracking capacities44), although some shipments were

believed to have been made operational too late for the war.45

Another important aspect of Lend-Lease that the statistics do not elicit is the

technology transferred to the Soviet Union beyond equipment deliveries. Early in the

war, Standard Oil of New Jersey pioneered the development of new aviation lubricants

suitable for cold weather. The Soviet Union both imported and manufactured aviation

lubricants. At the request of the U.S. Petroleum Administration for War (P.A.W.),

40 Tuyll, Feeding the Bear, 119.

41 Sutton, Western Technology and Soviet Economic Development, 1930-1945, 90.
42 Weeks, Russia's Life-Saver, 134.
43 ORE 4/1 Central Intelligence Group “Petroleum Resources within the USSR,” June 16, 1947, 13. This is in
addition to thirty-eight modern, American-built plants shipped to the Soviet Union prior to Lend-Lease, between
1930 and 1942.
44 Tuyll, Feeding the Bear, 119.
45 Sutton, Western Technology and Soviet Economic Development, 1930-1945, 88.

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Jersey Standard made its research on manufacturing these cold-weather lubricants

available to the Soviet Union.46 Unlike the Allies, Germany did not possess such

lubricants to make cold weather operation possible. The Wehrmacht's motor equipment

therefore sat mostly immobile during the winter.47 At the request of the State

Department and P.A.W., Jersey Standard also agreed to share its research on addressing

specific corrosion, gumming, and cold-weather problems.48 Socony-Vacuum supplied

the Soviet Union with technical data, refinery and plant designs, and pilot

manufacturing plants for the production of high-octane aviation fuel, lubricants, alcohol

additives, and synthetic rubber.49

Some scholars verge on arguing that the Soviet war machine (and potentially the

entire war) was dependent on Lend-Lease aid, while others, especially Soviet scholars,

have argued that Lend-Lease played an insignificant role in the Soviet victory. At least

with regards to meeting the Red Army's fuel needs, the actual contribution of Lend-

Lease lies somewhere in between, but probably closer to the former than to the latter.

By the outbreak of Russo-German war, the Soviet Union could barely meet its

own fuel needs, and indeed had considerable trouble providing the oil it was contracted

sell to Nazi Germany before the invasion.50 Its transportation network was

overburdened and its refineries were inadequate—a problem worsened by the U.S.

embargo on the Soviet Union of plants, plans, licenses, and technical data following the

46 Larson et al, New Horizons, 513-514.

47 Larson et al, New Horizons, 385.
48 Larson et al, New Horizons, 515.
49 Sutton, Western Technology and Soviet Economic Development, 90.
50 Eichholtz, War for Oil, 37.

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Soviet attack on Finland in the 1939-1940 Winter War.51 The German advance in 1941

also forced the mass evacuation of refinery equipment and staff from cracking plants

along the western borders of the Soviet Union. As a result, oil production fell

dramatically, dropping in June 1942 to 70% of its July 1941 levels.52

The turning point of the war on the eastern front was in 1943 at Stalingrad and

Kursk. The Red Army enjoyed numerical superiority, but the increasing size of the Red

Army that allowed the Soviet Union to repulse the Germans back to the Molotov-

Ribbentrop line by the end of 1943 created new logistical demands. Ammunition

consumption by the Red Army doubled between 1942 and 1943, and total fuel needs

increased by a quarter.53 The Soviet Union rebuilt refineries and diversified drilling, but

at the same time relied on steadily increasing imports of refined petroleum products. To

maximize its war effort, the Soviet Union needed refined petroleum products,

equipment and plants, and improvements in technology. Lend-Lease provided all three,

and helped alleviate the Soviet Union's tight production capacity and manpower

shortage.54

The United States furnished $12.5 billion in material assistance through Lend-

Lease, of which over $43 million was petroleum refining equipment and $111 million in

petroleum products.55 The U.S. used its strong economy, relative invulnerability, and

incomparably productive oil industry to aid the Soviet war machine. While it is difficult

51 Sutton, Western Technology and Soviet Economic Development, 88.

52 Igolkin, Sovyetskaya Neftyanaya Politikia, 81.
53 Tuyll, Feeding the Bear, 62.
54 Igolkin, Sovyetskaya Neftyanaya Politika 153
55 Tuyll, Feeding the Bear, 160; 156.

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to say exactly how these shipments affected the Soviet war effort, it is clear that Lend-

Lease was a crucial part of the Soviet war economy. The typical Soviet-era argument,

that the shipments were insignificant at the most critical times, is undermined by the

specificity of Soviet aid requests and the animosity among Soviet policymakers towards

any proposals that could have reduced Lend-Lease aid.56 American petroleum products

and refining technology was directed specifically toward fueling Soviet air power, and

without that material and technical petroleum aid, Soviet air power would have been

severely weakened during a time at which it was critically needed.

Germany's Retreat

Air raids on German oil refineries and synthetic oil plants in May 1944 caused a serious loss of

production, especially for high octane aviation fuel, which could only be produced

synthetically.57 Heavy bombing was destroying these facilities faster than they could be rebuilt,

and by July 1944 every major plant had been hit.58 Drastic measures were required. The loss of
56 A telling example of this occurred on June 1, 1942, when President Franklin D. Roosevelt told Soviet Foreign
Minister Vyacheslov Molotov of an impending reduction in Lend-Lease shipments from 4.1 to 2.5 million tons
over the course of the fiscal year in order to make shipping available for the opening of the second front in
Western Europe. Roosevelt may have expected Molotov to respond positively to the opening of the second front,
but Molotov fumed at the prospect of reduced shipping to accommodate a second front. The Soviet minister
feared cuts to “such non-military supplies as metals and railroad materiels, which have a direct bearing on the
solidarity of the present front” and cuts that would “impose restrictions on the Russian rear, e.g. on electric
plants, railroads, and machinery production,” which were “comparatively vital.” Roosevelt in turn suggested
that a strong second front (which the Soviets had been persistent in requesting) would help bring the second front
closer to Berlin. Molotov responded that the second front would be stronger if the first front still stood (Tuyll,
Feeding the Bear, 32). There are also numerous contemporary accounts of Josef Stalin expressing gratitude for
Lend-Lease shipments and technological and industrial support from the U.S.
57 Cooke et al, Target: Hitler's Oil, 140-141.
58 USSBS “Summary Report (European War),” 9. The report also notes the frequency with which oil plants were
attacked, and the speed with which they were rebuilt: “The story of Leuna [hydrogenation plant] is illustrative.
Leuna was the largest of the synthetic plants and protected by a highly effective smoke screen and the heaviest
flak concentration in Europe. Air crews viewed a mission to Leuna as the most dangerous and difficult
assignment of the air war. Leuna was hit on May 12 and put out of production. However, investigation of plant

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the Rumanian Ploesti oil fields to the advancing Red Army in August added further impetus. On

May 31, 1944, Adolf Hitler created the aptly-named position of General Commissioner for

Immediate Measures under Albert Speer's Armaments Ministry to solve the fuel crisis. Hitler

granted the appointee, Edmund Geilenberg, expansive powers: “He is responsible for tackling

the work turned over to him with a generous supply of manpower and material and reckless

energy. The speed of his work is not to be impaired either with formal or regional obstacles.”59

Geilenberg was given unlimited authority to requisition labor and materials, and commanded at a

time 350,000 people.

Geilenberg formulated a plan that would redistribute a significant portion of refined

petroleum products production to underground and dispersed facilities. Ideally, these facilities

would have eventually produced 82% of Germany's aviation gas, 25% of motor gas, 67% of

aviation lubricants, and 88% of diesel fuel, based on January 1944 consumption levels. Several

records and interrogation of Leuna's officials established that a force of several thousand men had it in partial
operation in about 10 days. It was again hit on May 28 but resumed partial production on June 3 and reached 75
percent of capacity in early July. It was hit again on July 7 and again shut down but production started 2 days
later and reached 53 percent of capacity on July 19. An attack on July 20 shut the plant down again but only for
three days; by July 27 production was back to 35 percent of capacity. Attacks on July 28 and 29 closed the plant
and further attacks on August 24, September 11, September 13, September 28 and October 7 kept it closed down.
However, Leuna got started again on October 14 and although production was interrupted by a small raid on
November 2, it reached 28 percent of capacity by November 20. Although there were 6 more heavy attacks in
November and December (largely ineffective because of adverse weather), production was brought up to 15
percent of capacity in January and was maintained at that level until nearly the end of the war. From the first
attack to the end, production at Leuna averaged 9 percent of capacity. There were 22 attacks on Leuna, 20 by the
Eighth Air Force and 2 by the RAF. Due to the urgency of keeping this plant out of production, many of these
missions mere dispatched in difficult bombing weather. Consequently, the order of bombing accuracy on Leuna
was not high as compared with other targets. To win the battle with Leuna a total of 6,552 bomber sorties were
flown against the plant, 18,328 tons of bombs were dropped and an entire year was required.” (USSBS
“Summary Report [European War],” 42)
59 USSBS “Underground and Dispersal Plants in Greater Germany,” 1. There is no recent, complete technical
overview of the German domestic oil industry, but the United States Strategic Bombing Survey provides the best
and probably most reliable overview. The study is based on the close examination of German industrial plants,
cities, and other targets, and includes statistical data as well as information from interviews and interrogations of
“virtually all” surviving political and military leaders.

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German technocrats stated after the war that they had proposed a similar measure as early as

1940. They reported that they were told that the war would have ended by the time these hidden

plants could have been constructed, and moreover were threatened with detention in labor camps

for “questioning the Reich's impregnability.”60

The entire program called for 140 separate facilities at a cost of 1.4 billion Reichsmarks

and a year's worth of labor from 200,000 men. Scarcity of manpower and materials, and the

advance of the Allies, required Germany to cut the program in half in the final months of the war.

By the end of the war, these facilities were operating far under capacity, having only produced

about 1 million barrels of motor gas and diesel fuel. Desperately needed aviation fuel was not

projected to be in production until fall 1945.61

It would be nearly impossible to argue that the collapse of the German oil industry either

precipitated the collapse of the German economy as whole, or that it brought about the fall of the

Third Reich. It is however very probable that the failure of the oil industry was a contributing

factor in Germany's defeat. The U.S. Strategic Bombing, referring to the Kriegseilbericht (War

Express Report) produced by Nazi policy planners, noted that industrial capacity of Germany

declined at a remarkably late date:

The most striking result of this emergency industrial survey is its indication of well maintained
production almost to the end of 1944, in the face of the accumulated stresses of a long war and
intensive efforts at aerial destruction of the German industrial machine. The Kriegseilbericht
shows that industrial activity in November stood at approximately 95 percent of its second

60 Ibid. Interestingly, the USSBS report on the underground and dispersal plants suggests in its concluding remarks
that the program, had it started earlier in the war (and been more carefully planned), could have created a
synthetic industry “relatively safe” from bombing (USSBS “Underground and Dispersal Plants in Greater
Germany,” 1). Some of the schemes verged on the absurd; one involved the covering of a mountain with a thick
layer of concrete, and then excavating the mountain, leaving behind a large mountain-shaped concrete shell
(USSBS “Underground and Dispersal Plants in Greater Germany,” 65.).
61 USSBS “Underground and Dispersal Plants in Greater Germany,” 2-4.

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quarter level, and by December had lost another 10 percent of its April-June rate. Only in January
1945 did the further loss of industrial areas and the mounting effects of aerial attack cause a
pronounced recession of output, foreshadowing the almost complete breakdown of the next
months.62

By contrast, the German oil industry, which was a high priority target for the Allies, collapsed

very quickly. In December 1944, while the total production figures were around 85% of the

second-quarter 1944 level, refined petroleum production was below 40% of that of first-quarter

1944, and by March 1944, that figure fell to 12%.63

The synthetic oil sector was of higher priority for Allied bombing than was the crude oil

industry because of the greater range of products synthetic oil yielded. Synthetic oil made from

hydrogenation, unlike crude oil extracted from the ground, produced not only aviation fuel, but

also nitrogen, which was needed for explosives and for agricultural use, and methanol, used for

high explosives, and synthetic rubber. The attack on synthetic oil plants resulted in severe cuts in

production of all of those resources.64 The synthetic oil industry therefore collapsed much more

rapidly than the crude oil industry did, falling in December 1944 to 16% of its peak production

rate, and March 1945 falling to 3%. Crude oil production rates, by contrast, had fallen to 24% of

peak production by March 1945—a critical loss, but still less devastating than the losses dealt to

the synthetic oil industry.65

Ironically, the underground and dispersal plants that were ordered in response to

the bombing campaign of May 1944 were themselves particularly vulnerable to

disruption. The plants were dispersed too widely, and, as a result, were especially

62 USSBS “Overall Economic Effects Division Final Report,” 17.

63 Stokes, “The Oil Industry in Nazi Germany, 1936-1945,” 273.
64 USSBS “Summary Report (European War),” 9-10.
65 Stokes, “The Oil Industry in Nazi Germany, 1936-1945,” 274-275.

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dependent on railroad networks, which were by fall 1944 targets for Allied bombing. 66

Attacks on sources of electrical power, fuel, and input coal also disrupted production. 67

The assault on the synthetic industry, which produced 95% of Germany's aviation

fuel, caught the Luftwaffe in a fatal trap. Operating at just one-tenth its minimum

required fuel in fall 1944, the German air force could no longer defend against bombing

raids, exposing the German oil industry to further bombardment. 68 The fighting

continued for several months, but the Wehrmacht paralyzing lack of fuel made major

operations and any real chance of resistance on either front hopeless.

Conclusion

Interwoven within the history of oil in the Second World War is a remarkable tension

between necessity or expediency and the ideological commitments and personal

priorities of the Nazi regime. The buildup of the synthetic oil industry is one instance

where the two coincide, as the domestic industry alleviated the burden on Germany's

foreign exchange, all the while isolating Germany from the world economy and

furthering the goal of achieving autarky. However, Hitler's calls for rearmament, along

with the wildly irresponsible targets for fuel self-sufficiency set by the Nazi regime and

even IG Farben executives, clearly shows priorities divorced from the realities faced by

the industry.

In dealing with oil issues, the führer and top Party leadership repeatedly let

66 USSBS “Over-all Report (European War),” 59-61.

67 USSBS “Underground and Dispersal Plants in Greater Germany” 66.
68 Yergin, The Prize, 330.

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hubristic visions and hopeful thinking based on Nazi ideology overrule even the most

practical of considerations. Among the egregious offenses to reason in this regard was

the decision to invade the Soviet Union with only enough fuel to sustain operations for a

matter a weeks. Worse was that Nazi policymakers were quite aware of this problem,

but shrugged the issue off based on the assumptions that the Soviet bureaucracy and the

Soviet people would be unable to sustain a war against Germany, that Rumanian oil

fields in terminal decline could somehow double their production in a very short

amount of time, and that the oil fields at Baku deep into Soviet territory could be

reached and exploited in enough time to alleviate any potential fuel crisis. Even

Wehrmacht's push in 1942 to take the South Caucasian oil fields was based on

shockingly stupid logic—how could Hitler have believed that Maikop, a region located

well behind Soviet lines, could be captured intact and spared of sabotage without any

element of surprise, and when refineries on the western borders, for example, were fully

evacuated of equipment and personnel when the Wehrmacht did have the element of

surprise? The campaign to capture Soviet oil fields made practical sense, but the

apparent belief that the Wehrmacht, already overstretched in 1942, had the logistical

capacity and strength of force to reach the oil fields, capture them by surprise and to

prevent sabotage, and defend the installations can only be explained by hubris

combined with willful ignorance of the reality on the ground.

The fate of Georg Thomas, the Nazi strategist who correctly predicted the

impending fuel emergency brought on by Germany's invasion of the U.S.S.R., offers a

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telling example of Hitler's attitudes towards views that did not follow in lockstep with

Nazi political correctness. Thomas was sacked in January 1943, just the Oil Technical

Brigade withdrew from the Maikop oil fields and the veracity of his warnings was

beyond questioning. General Wilhelm Keitel told Thomas that: “I must concede to you

today that your warning and economic judgments before and during the war were

correct. But you have made yourself intolerable to the Führer and the Party by

expressing those views loud and often. Hitler has made clear that he has no use for men

who seek continually to instruct him.”69

Paul Kennedy's argument, that the economic capacity of the Allied powers

overwhelmed the Axis powers in the long-run, rings true in the case of oil. 70 While

Germany was cut-off from the foreign imports that had supplied it during the 1930s, the

Allies possessed both crude oil sources in the United States, in Latin America, in the

Soviet Union, and in the Middle East, as well as the means to ship petroleum products

through pipelines and oceangoing tankers. When German air power was left grounded

with no fuel or immobilized by solidified engine lubricants, the Soviet Union could rely

on Lend-Lease shipments to fill the critical need for aviation fuel and cold-weather

lubricants, along with other specific oil products and refining equipment.

Hydrogenation plants could decrease Nazi Germany's reliance on foreign oil in

peacetime, but they were ultimately incapable of matching the production and logistical

capabilities of the Allies, and were insufficient and vulnerable in prolonged war.

69 General Wilhelm Keitel quoted in Goralski et al, Oil and War, 53-54.
70 Kennedy, The Rise and Fall of Great Powers, 347-357.

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As the war shifted against Germany, Nazi policymakers held a persistent dream

that fortunes could be reversed at the final hour by a 'wonder weapon.' 71 The Third

Reich spent liberally on technologies that ultimately had at most a negligible effect on

the course of the war, or simply could not be used because the Reich lacked more basic

requirements. A particularly illustrative example can be found in the case of the Me-

262, the world's first operational jet-powered fighter, which was taxied to the runway by

oxen to save on fuel consumption. The hydrogenation plants were a technical feat

unmatched by foreign industries, but underground and dispersal plants designed to

elude Allied bombers were similar to the 'wonder weapons' that turned out to be

unfeasible. For all its speed in the air, the Me-262 was highly vulnerable on the runway,

and for all trouble went through to bury hydrogenation plants, they proved just as

vulnerable as any other plant, as attacks on more exposed infrastructure like railways

could easily disrupt production.

Germany's shortage of oil, and its quest for new sources, played an important

factor in the collapse of the Third Reich. The qualitative question of exactly how

important oil was is a debatable matter. An Allied victory was hardly inevitable, so there

were certainly other factors that led to Germany's defeat, such as battlefield

effectiveness or more moral causes.72 Oil operated as an economic factor, and the

United States' and the Soviet Union's high production capacity and relative mastery of

71 Overy, Why the Allies Won, 240. Richard Overy disagrees with the 'overwhelming force' argument, that the
Allies defeated the Axis based on their superior economic power, but by analyzing the failure Germany to
produce any return on 'wonder weapons,' he also strengthens the argument that the weakness and disintegration
of the German economy was at least a major contributing factor to Germany's defeat.
72 Overy, Why the Allies Won, 325.

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reservoir security and transportation capabilities, compared with Germany's fuel

shortages and overstretched logistical capacities, helped the Allies win the war.

Furthermore, an examination of Nazi Germany's quest for oil also reveals Nazi

leadership consistently ignored signs of imperial overstretch as a result of an ideology

that encouraged hubris at the expense of practical considerations.

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