Aramco: The Story of the World’s Most Valuable Oil Concession and Its Landmark Arbitration

The Aramco story is a fascinating and colourful history of the world’s most valuable oil concession, the challenges overcome by its original American owners and the orderly transfer of control of the world’s largest oil company to the Kingdom of Saudi Arabia. It involved the largest American overseas investment, a cornerstone of U.S. foreign policy, the stabilization of global energy markets and the Middle East region, along with the transformation of a medieval society into a modern state. Unlike some of the other states in the region, Saudi Arabia never intended to nationalize or expropriate Aramco. Instead, it worked closely with its American investors and the American government to maximize production for the benefit of all the parties involved. The parties did this within a long tradition of “friendship and good will.” Despite their best efforts, they did come to blows in a landmark arbitration, the Saudi Arabia v.Aramco Arbitration, which is one of the most historically important investor state arbitrations of the last century.This article describes that case with insightful detail, along with how the parties maintained their “friendly relationship” long after the end of the arbitration.