(UNTITLED)

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP80R01443R000200370001-0
• Release Decision: RIPPUB
• Original Classification: K
• Document Page Count: 5
• Document Creation Date: December 9, 2016
• Document Release Date: December 3, 1998
• Sequence Number: 1
• Content Type: HW

Approved For Release 2000/08/30 : CIA-RDP80R01443R000200370001-0
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AMERICAN POSITION IN
SAUDI ARABIA DETERIORATING
I. Indications crisis developing between Saudi
Government and US, ARAMCO.
A.
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25X1X6 King Saud very angry with US.
In present mood, king might terminate
both Dhahran Air Base Agreement and US
military missions. King to be guided by
Council of Ministers, which largely anti--
American. (Air Base Agreement should run
to 1961: can be terminated June 1956.
Any earlier termination. illegal.
B. ARAMCO fears emergency soon in showdown
on Onassis Agreement. Will refuse
compromise on exclusive rights, despite
chance shutdown and possibly
nationalization.
Approved For Release 2000/08/30 : CIA-RDP80R01443R000200370001-0
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Approved For Release 2000/08b` C-8IR kDP80R01443R000200370001-0
II. Increasing anti-American trend:
A. Threat terminate military, agreements
probable insistence on Onassis Agreement
continue series moves since Saud's
succession (November 53).
1. Replacement American construction
firm by Germans (January).
2. Involvement ARAMCO in Buraimi dispute:
(February-June).
3. Ratification Onassis Agreement (April).
4. Refusal visas for French soldiers en
route Indochina (May).
5. Termination Point IV Agreement (June).;
6. Opposition (with Egypt) to Iraqi
adherence Turkish-Pakistani Pact (June).
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III. Prospects: No indication Saud will change.
A. Possible attempt abrogate Air Base
Agreement, more likely terminate it 1956.
B. Terminate US military training.
C. Strong possibility Saud, whose advisors
have stake in Onassis Agreement, will
"nationalize" oil:
1. Mistaken belief can replace US
technicians with Germans.
2. Hope up revenue by eliminating ARAMCO
profits.
3. Desire enhance prestige as Arab
leader by ousting Americans.
4. Wish avoid loss face involved
cancellation Onassis Agreement.
D. Nationalization attempt would make Saudi
another Iran: loss most revenue would
bring economic crisis, political ferment,
could cause overthrow Saud and whole
Approved For Rffiftle O&/8/30 : CIA-RDP80R01443R000200370001-0
SECRET
INFORMATION ONLY (3)
 Approve o ke ease 2000/08730:Q,,
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I. Middle East averages some 20% of world oil
production (exclusive of Soviet):
1950 1953
WORLD 3,476 4,320 (million bbls)
MIDDLE EAST 657 (18%) 902 (21%)
II. Saudi Arabia averages over 30% of Middle
East oil production.
1950 1953
MIDDLE EAST 657 902 (million bbls)
SAUDI 200 (30%) 308 (34%)
IRAN 243 10
III. Bulk of Middle East oil goes to Europe,
where it now furnishes more than 90% of
Europe's total crude imports:
1938 1950 1952 1953
23% 85% 94% (higher)
Approved For Release 2000/08/30 : CIA-RDP80R01443R000200370001-0
CONFIDENTIAL