(IBN SAUD, WAHHABIS and OIL, to 1945 – continued)
In 1932 the newly formed Kingdom of Saudi Arabia was austere and in debt. Its main income was its tax on pilgrims to Mecca, and this was in decline because of the Great Depression. In 1933, Saudi Arabia and the United States established diplomatic relations, and that year the kingdom granted a concession to Standard Oil of California (now Chevron) to explore and to produce oil. A commercially significant amount of oil had been discovered in Iran around 25 years earlier and in Iraq four years earlier. The Saudis were not very hopeful, but they had made their agreement with a U.S. company, which had the advantage of not being British – Britain being the dominant power in the region and not well liked by Saud. A U.S. company was chosen also because of King Saud's impression of Americans, rising from a missionary doctor from the United States who tended people in the area, including King Saud and a handful of other Americans he had met in his kingdom.
In 1938, while searching for water, United States geologists in Saudi Arabia found oil instead – much of it. The largest known source of oil in the world were discovered. Needing people who knew how to develop and operate oil fields, ibn Saud invited U.S. oil companies to his kingdom, the king's government facing criticism by some who believed that inviting foreigners to the kingdom was un-Islamic. Many in Saudi Arabia remained hostile to foreigners. The monarchy clung to practicality and set up a joint enterprise with a number of U.S. oil companies. In 1939 King Saud opened the valve for the first flow of Saudi oil to a naval oil-tanker, and in 1944 the joint enterprise was renamed the Arabian American Oil Company (Aramco).
Ibn Saud: Founder of a Kingdom, by Leslie McLouglin, St. Martin's Press, 1993
The Kingdom of Saudi Arabia, by David E. Long, University of Florida Press, 1997
Copyright © 2001-2013 by Frank E. Smitha. All rights reserved.