Saudi Aramco Quotes

The Saudis considered the petroleum under their soil a gift from God, but accessing its value laid within man’s capacity. Until the Saudis developed the capabilities themselves, they would simply import the human capital they needed to make that petroleum valuable. This meant importing Aramco to run the oil industry, IBI and, later, other companies to build modern cities and transportation, and even American financial advisors to create a modern banking system. The trick was to buy what they did not have from the outside, and then to make it their own.

Three years after the United States and the Israelis reached across Iran’s borders and destroyed its centrifuges, Iran launched a retaliatory attack, the most destructive cyberattack the world had seen to date. On August 15, 2012, Iranian hackers hit Saudi Aramco, the world’s richest oil company—a company worth more than five Apples on paper—with malware that demolished thirty thousand of its computers, wiped its data, and replaced it all with the image of the burning American flag. All the money in the world had not kept Iranian hackers from getting into Aramco’s systems. Iran’s hackers had waited until the eve of Islam’s holiest night of the year—“The Night of Power,” when Saudis were home celebrating the revelation of the Koran to the Prophet Muhammad, to flip a kill switch and detonate malware that not only destroyed Aramco’s computers, data, and access to email and internet but upended the global market for hard drives. It could have been worse. As investigators from CrowdStrike, McAfee, Aramco, and others pored through the Iranians’ crumbs, they discovered that the hackers had tried to cross the Rubicon between Aramco’s business systems and its production systems. In that sense, they failed.

Getty’s 55-cent-a-barrel royalty to the Saudis loomed over Aminoil’s 35-cent royalty to Kuwait, the roughly 33-cent royalty that Aramco had just been compelled to pay the Saudis—and far overshadowed the 16½ cents that Anglo-Iranian and the Iraq Petroleum Company were paying in Iran and Iraq respectively, as well as the 15-cent royalty that the Kuwait Oil Company was paying.

Stuxnet spurred the Iranians to create their own cyber war unit, which took off at still greater levels of funding a year and a half later, in the spring of 2012, when, in a follow-up attack, the NSA’s Flame virus—the massive, multipurpose malware from which Olympic Games had derived—wiped out nearly every hard drive at Iran’s oil ministry and at the Iranian National Oil Company. Four months after that, Iran fired back with its own Shamoon virus, wiping out 30,000 hard drives (basically, every hard drive in every workstation) at Saudi Aramco, the joint U.S.-Saudi Arabian oil company, and planting, on every one of its computer monitors, the image of a burning American flag. Keith

MBS took effective control of Saudi Aramco away from the Ministry of Petroleum

Five years into King Saud’s reign, the country was facing bankruptcy. Civil servants, soldiers, and contractors were not being paid. The American-owned oil company Aramco refused to make additional loans against future Saudi production.19 The Saudi Riyal was devalued by 50 percent, inflation soared, and there was labor unrest in the Eastern Province. By 1957, the kingdom was forced to seek a loan from the International Monetary Fund, which insisted on seeing the country’s first detailed budget. That financial plan sharply reduced royal family living expenses. Over the next six years privy-purse expenditures fell by two thirds. In Riyadh, many half-finished palaces were abandoned, and infuriated princes correctly blamed their distress on King Saud’s financial mismanagement.

In Riyadh, King Saud’s brothers became convinced that his foreign policy bungling, combined with his economic mismanagement, was putting their family at risk. The elder brothers agreed that Saud should keep his throne but relinquish all executive authority to Faisal. King Saud accepted this arrangement in March 1958. Crown Prince Faisal became prime minister, appointed himself finance minister, and began to balance the kingdom’s budget. He cut spending across the board, suspended development projects, canceled agriculture subsidies, delayed payments to contractors and tribal sheikhs, imposed import controls on luxury goods, and devalued the riyal. He reduced stipends for royal family members and obtained new loans from Aramco as well as leading merchants, including Osama bin Laden’s father Mohammed.24 At the same time, oil production increased by more than 50 percent from 1 million barrels a day in 1957 to 1.6 million barrels a day in 1962.25 The kingdom’s budget was balanced and its currency stabilized. The inflation rate fell sharply. By 1960, Faisal’s austerity had reduced not only the national debt, but also his own popularity with the tribes, merchants, and princes.

In 1917 he was still a minor, provincial chieftain in what was nominally part of the Ottoman Empire when he summoned American, Christian missionary doctors to Riyadh from Bahrain. Here is what the wife of one doctor wrote about the meeting: “While you are here, my house is yours” added the sheikh, motioning for Paul to sit down with him. A slave brought in coffee, and while Ibn Saud sipped, he explained that he had asked the doctor to come, neither for his health nor the health of his family, but for the needs of his people. He had already arranged the use of a nearby house for a hospital where he wanted his people treated without any cost to them.5 These American missionary doctors from Bahrain continued to come to the Nejd and Eastern Province of Saudi Arabia until the 1950s, when the Aramco Health Department took over from them.

Under King Salman, the technocrats’ representative body has lost influence. Major reforms have bypassed it. The Majlis al-Shura did not vote on Vision 2030, the Saudi Aramco initial public offering, or the imposition of a value-added tax.

Aramco is widely recognized as more efficient, technically competent, and meritocratic than most Saudi institutions.14 Nearly all its senior management and 80 percent of its 75,000 employees are Saudi nationals. Twenty percent of its new hires are women.

What gives Saudi Arabia its importance in global energy markets—and thus, a geopolitical influence disproportionate to its economic size or military strength—is the role that it plays as the producer of last resort. For decades, Saudi Aramco has maintained significant spare production capacity that allows it to rapidly put large volumes of oil into the market.

The profession of driver was very attractive to the bedouin: the replacement of a camel by a truck as a means of transport did not humiliate even a shaikh’s son and corresponded to the nomads’ traditional mentality.136 Aramco opened special centres where young bedouin were trained in driving and truck maintenance.137 In the 1950s and 1960s the government encouraged the sale of cars to the bedouin, and some of them sold their camels and bought trucks. Grants and gifts from the king enabled the tribal nobility to buy motorized transport of their own. Trucks replaced camels, where the terrain permitted their use.

The US and Unocal wanted to believe that the Taliban would win and went along with Pakistan’s analysis that they would. The most naive US policy-makers hoped that the Taliban would emulate US–Saudi Arabia relations in the 1920s. ‘The Taliban will probably develop like the Saudis did. There will be Aramco, pipelines, an emir, no parliament and lots of Sharia law. We can live with that,’ said one US diplomat.20

Number three on the historic polluter list, Chevron, one of McKinsey’s biggest clients, generated at least $50 million in consulting fees in 2019. Saudi Aramco, number one on the list, has been a McKinsey client since at least the 1970s.

On at least two occasions, Tehran launched highly effective cyber attacks against Saudi Arabia, one of which destroyed thousands of Saudi Aramco computers.20 In September 2019, Iranian cruise missiles and drones attacked the kingdom’s Abqaiq oil processing facility and succeeded in taking nearly half of Saudi oil production offline for several weeks.

There is now a Shia minister of state, president of Saudi Aramco and chairman of the Crown Prince’s mega-project NEOM, an ambitious and yet unproven concept for an entirely new futuristic city to be built near the border with Jordan.

Saudi Arabia went from a backward desert kingdom to a world power, beginning in 1933, with the discovery of vast oil fields in the eastern flat lands of the peninsula. Standard Oil of California briefly owned the oil concession, assigning it to a venture that eventually was named ARAMCO (Arabian American Oil Company).

When Abdul Aziz captured Riyadh in 1902, the city consisted of only one square kilometer; a century later, Riyadh had grown to 1,300 square kilometers. When Abdul Aziz consolidated his kingdom in 1932, Riyadh had a population of fewer than forty thousand. By the beginning of the 21st century, its population approached six million. Riyadh became a bustling,modern city with terrible traffic, upscale malls, and neighborhoods stratified by class and wealth. In 1932, the man who ruled Saudi Arabia from Riyadh had barely a riyal to his name, but Abdul Aziz’s sons, the succeeding rulers of Arabia, would enjoy immense wealth and come to own the most profitable company in the world—Saudi Aramco.

Back in 1947, Saudi Arabia lacked basic modern infrastructure. At the time, IBI was already completing projects for Aramco, so the company had been the natural choice to contract for the public works campaign in 1947. By 1951, however, major cities were already electrified and transportation routes had been built. Sanitation services, hospitals, hotels, and even cafés had sprung up around Riyadh and Jeddah. The equipment, plans, and logistics for further expansions were in place. The easily accessible knowledge and personnel that, in the 1940s, made IBI such an advantageous choice now took a back seat to cost.

Tim Barger, the son of Aramco geologist Tom Barger, was the seventh American born in Saudi Arabia. He explained that Dhahran, Aramco’s headquarters located in the region where oil was originally found, was “deliberately placed there, away from society” because “the King didn’t really want Americans to mingle with Saudis anyway.” His impression of Abdul Aziz was that the king “just wanted Americans to go there, stay out of his hair, and produce oil and make him rich.

Even though Saudis eventually came to occupy the senior management positions in the company, Aramco remained an oasis of Western culture and business standards within the conservative and traditional kingdom. Nothing, al Saud believed, should get in the way of profit and power.