Saudi Aramco: From 'Prosperity Well' to Energy Giant

The founder of Saudi Arabia King Abdulaziz speaks to the general manager of Aramco N. Devins during the opening ceremony of the Riyadh-Dammam train link in October 1951. (AFP)
The founder of Saudi Arabia King Abdulaziz speaks to the general manager of Aramco N. Devins during the opening ceremony of the Riyadh-Dammam train link in October 1951. (AFP)
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Saudi Aramco: From 'Prosperity Well' to Energy Giant

The founder of Saudi Arabia King Abdulaziz speaks to the general manager of Aramco N. Devins during the opening ceremony of the Riyadh-Dammam train link in October 1951. (AFP)
The founder of Saudi Arabia King Abdulaziz speaks to the general manager of Aramco N. Devins during the opening ceremony of the Riyadh-Dammam train link in October 1951. (AFP)

From its beginnings in 1938 when it first struck oil with the aptly named "Prosperity Well", Saudi Arabia's energy giant Aramco has delivered unimaginable riches to the kingdom.

Over the decades, the firm has grown into the world's largest and most profitable energy company, generating some 10 percent of global crude supplies and trillions of dollars in income.

Aramco shares hit the domestic bourse on Wednesday after the world's largest initial public offering in which 1.5 percent of its shares were sold to raise $25.6 billion.

After hitting its upper limit on the stock market debut, the company is now valued at a massive $1.88 trillion.

The listing came despite Aramco being hit by a string of attacks on its facilities, the latest and most serious on September 14 when drone and missile strikes halted the flow of 5.7 million barrels of oil per day -- more than half of its output, reported AFP.

The attack had threatened to undermine the IPO plans but the company quickly said it had restored production and output capacity to pre-strike levels.

Striking gold

Aramco has its origins in a 1933 concession agreement signed by the Saudi government with the Standard Oil Company of California. Drilling began in 1935 and the first oil began flowing three years later.

It gained its current name from the subsidiary created to manage the agreement that was called the Arabia American Oil Company in the late 1940s.

In 1949, oil production hit a milestone 500,000 barrels per day and the following year Aramco built the 1,212-kilometer (753-mile) Trans-Arabian Pipeline to export Saudi oil to Europe across the Mediterranean.

Production rose rapidly after the discovery of large offshore and onshore oilfields including Ghawar, the world's largest with some 60 billion barrels of oil, and Safaniya, the biggest offshore field with 35 billion barrels.

In 1973, with prices spiking at the peak of the Arab oil embargo the Saudi government acquired 25 percent of Aramco to increase its stake to 60 percent and become a majority stakeholder.

Seven years later, it was nationalized, and in 1988 it became the Saudi Arabian Oil Company, or Saudi Aramco.

From the 1990s, Aramco invested hundreds of billions of dollars in massive expansion projects, raising its oil output capacity to more than 12 million bpd, alongside making bold international acquisitions and pursuing joint ventures.

In mid-September, Aramco maintained some 260 billion barrels in proven oil reserves, the second largest in the world after Venezuela, in addition to 300 trillion cubic feet of gas.

Based in Dhahran in the country's east, the firm has key oil operations in the United States, China, India, South Korea and several European and Asian nations.

Aramco has also built a network of pipelines and refineries inside and outside the Kingdom and expanded its presence in the petrochemicals industry.

Earlier this year, it opened its account books for the first time, announcing a $111.1 billion net profit for 2018, up 46 percent on the previous year, and saying it had generated $356 billion in revenue.



Alarm in Tel Aviv After Removal of Pro-Israel Officials from Trump Administration

US President Donald Trump and Israeli Prime Minister Benjamin Netanyahu meet in the White House in April. (dpa)
US President Donald Trump and Israeli Prime Minister Benjamin Netanyahu meet in the White House in April. (dpa)
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Alarm in Tel Aviv After Removal of Pro-Israel Officials from Trump Administration

US President Donald Trump and Israeli Prime Minister Benjamin Netanyahu meet in the White House in April. (dpa)
US President Donald Trump and Israeli Prime Minister Benjamin Netanyahu meet in the White House in April. (dpa)

The dismissal of pro-Israel officials in the White House sparked concerns in Tel Aviv as US President Donald Trump’s “America First” sidelines allies and reflects a broader effort to curb foreign influence across the administration.

“Israeli officials are expressing growing concern over a series of unexpected personnel changes within the US administration, particularly involving individuals widely seen as strongly supportive of Israel,” sources told the Ynetnews website, which is affiliated to the Israeli Yedioth Ahronoth newspaper.

The reshuffling comes amid rising tensions between Trump and Israeli Prime Minister Benjamin Netanyahu over a potential strike on Iran and the ongoing war in Gaza.

According to the Israeli report, two senior officials recently removed from their posts are Merav Ceren, a dual US-Israeli citizen who was only recently appointed as head of the Iran and Israel portfolio at the National Security Council, and Eric Trager, who oversees the Middle East and North Africa.

Both had been appointed by former National Security Advisor Mike Waltz, a staunch supporter of Israel, who was himself dismissed by Trump.

Ynetnews wrote that their removal was reportedly carried out by Waltz’s successor, Secretary of State Marco Rubio.

Meanwhile, another high-profile figure expected to depart is Morgan Ortagus, deputy to special envoy Steve Witkoff and the official handling the Lebanon portfolio. Sources say her departure is not voluntary.

Ortagus, who converted to Judaism and wears a Star of David necklace, is considered one of the strongest supporters of Israel within the administration.

According to the Israeli report, she played a key role in ceasefire negotiations between Israel and Lebanon and in persuading the Lebanese government to take a firm stance against Hezbollah and disarm Palestinian refugee camps.

“Her imminent departure has stunned officials in Jerusalem, where she is viewed as closely aligned with Israeli interests,” Ynetnews said.

Officials following the issue do not rule out the possibility that more pro-Israel officials may be removed.

In the Trump administration, they note, decisions often come abruptly.

These removals are not occurring in a vacuum, but rather reflect a broader distancing between Jerusalem and the Trump administration, which appears to be pursuing its own strategic calculus.

Israeli sources familiar with US-Israel relations told the Israeli website that the spate of removals is driven by Trump’s “America First” agenda.

According to those sources, the shakeup is not specifically aimed at Israel but reflects a broader effort to curb foreign influence across the board.

They stress that the dismissals were not a result of the officials' views on Israel, but rather part of Trump’s ongoing attempt to weaken the National Security Council and consolidate control of US foreign policy in his own hands.

This, they said, explains why Trump has left the national security advisor post vacant, with Rubio assuming the responsibilities instead.

Also, the sources noted that the push to remove pro-Israel figures is being led by Trump’s son, Donald Trump Jr, and Vice President JD Vance.

Ynetnews said that Netanyahu has reportedly confided in closed-door discussions with his confidant, Strategic Affairs Minister Ron Dermer, that he misjudged the direction the US was taking on Israel and the broader Middle East.

Senior Israeli officials said Netanyahu did not hide his disappointment with Dermer.

“Dermer misread the situation; he was convinced the US would never turn against us,” said one source.

“He failed to anticipate the shift in US policy toward Israel. Even now, Dermer still believes the US will remain supportive and maintain coordination, but the truth is, he’s lost his bearings.”