The Rise of Saudi Arabia • 2451940s, Ibn Sa'ud was the Arabs' elder statesman. Although his Hashimite
rivals in Transjordan and Iraq resented Ibn Sa'ud for driving their father
from the Hijaz, they came to respect him.Oil Discoveries and Their Effects on the Saudi Kingdom
In today's world, it is easy to forget that Ibn Sa'ud and his kingdom were
extremely poor for most of his life. Najd was a sun-parched, mountainous
land far from any sea, the Persian Gulf provided only pearls and scanty
trade to Hasa, Asir had some upland areas suitable for farming, and the
Hijaz provided a meager income from the annual ha]]. Usually about
150,000 pilgrims came to Mecca each year; the figure of a quarter million
reported in 1926 (just after the Saudi conquest) was exceptional. Saudi
Arabia's economy depended on the date palm and the camel until the late
1930s. Several British companies had unsuccessfully prospected for oil in a
few provinces of the kingdom. There were abandoned gold mines, and it
was widely thought that Arabia contained other valuable minerals; but its
harsh climate, rapacious bedouin, and Wahhabi fanaticism discouraged
outside explorers. Ibn Sa'ud was once heard to say, "If anyone were to offer
a million pounds, he would be welcome to all the concessions he wanted
in my country."
The man of the hour was an American whose surname you may recall
from Chapter 13—Charles Crane, the plumbing manufacturer and philan¬
thropist involved in the 1919 King-Crane Commission. After a sojourn in
the Yemen, where he financed a successful search for minerals, Crane vis¬
ited Ibn Sa'ud in 1931. They discussed a similar quest in the Hijaz, hoping
to find enough underground water to pipe into Jidda (Mecca's port). But
Crane's mining engineer, Karl Twitchell, soon found that neither water nor
oil existed in economic quantities beneath the largely barren Hijaz. Two
years later, though, Twitchell returned, this time in the service of Standard
Oil of California (Chevron), which outbid a British representative of the
Iraq Petroleum Company (now BP) for exploration rights in eastern Ara¬
bia. For a cash loan amounting to 50,000 gold sovereigns (about $300,000,
now worth $3 million), plus an annual rent of 5,000 more, Ibn Sa'ud gave
the Americans a sixty-year concession to search for oil in Hasa, with prefer¬
ential exploration rights in other parts of his kingdom. They agreed that
more loans would be made later if oil were found in marketable quantities,
plus a royalty of a gold sovereign ($6) for every five long tons (a "long ton"
equals 2,240 pounds, slightly more than a metric ton) of oil taken from
Saudi territory.