The announcement of the proposed U.S. agreement to help build Saudi Arabia’s civilian nuclear energy program on July 22, in the midst of the U.S. war on Iran, indicates that both Washington and Riyadh have concluded, from the perspectives of their respective vital national interests, it’s time for a reset of the 80-year-old U.S.-Saudi strategic relationship.
The original strategic understanding forged in February 1945 by Franklin D. Roosevelt and King Abdul Azziz Ibn-Saud was based on a simple bargain anchored in realpolitik: energy security for the United States in return for economic security for Saudi Arabia.
America would help the Kingdom monetize its oil reserves (first discovered in 1932) via exploration, development, and production, and serve as the anchor purchaser of its oil. The proceeds from oil exports would help finance economic growth and development of the Kingdom and purchases of military equipment needed to safeguard its territorial integrity. The U.S. would have a secure and assured source of oil sufficient to meet its growing requirements following the Second World War.
NUCLEAR OPTION: THE ONLY LOGICAL ANSWER TO AI ENERGY CRISIS
Indeed, following Roosevelt’s death, Ibn-Saud reached out to Harry S. Truman to reconfirm the original strategic understanding. In a message of December 4, 1947, the King declared: “Although we differ enormously on the question of Palestine but still we have our own mutual interests and friendship to safeguard … I do not anticipate that a situation will arise whereby I shall be drawn into conflict with friendly western powers over this question.”
Washington acknowledged the bargain in its reply of December 12, 1947: “U.S. is reassured that King does not anticipate situation will develop whereby he will be drawn into conflict with friendly Western Powers over Palestine question.”
Simply put, Ibn-Saud would not sacrifice his kingdom’s vital national interests — American support for the monarchy, and the rapid expansion of Saudi oil production and exports to fund economic growth and development — on the altar of Palestinian aspirations.
Realpolitik is the compass that has guided the Saudis in their relationship with great powers.
In 1915 Ibn-Saud negotiated the Treaty of Darin with Great Britain, pursuant to which he undertook, with British assistance, to lead his Nejd tribesmen in a revolt against the Ottoman Empire and carve out an independent emirate in eastern Arabia, while promising to respect British protectorates in the Persian Gulf.
In the successor Treaty of Jeddah of 1927, Ibn-Saud reaffirmed his acknowledgement of British imperial interests in the Middle East, including its newly acquired mandates of Palestine, Trans-Jordan and Iraq, in exchange for recognition as the self-proclaimed King of Hejaz (which he had wrested from the Sharif of Mecca and the Hashemites, allies of the British). Crucially, Ibn-Saud promised that his territories would not be used for subversive activities directed against British interests.
So, what has changed? For the foreseeable future, the U.S. will not need Saudi oil for its energy security. As the National Security Strategy of the United States of America (2025) declares: “As … American energy production ramps up, America’s historic reason for focusing on the Middle East will recede.”
Since 2018, the U.S. has been the world’s largest oil producer. In 2025, U.S. oil production amounted to 13.6 million barrels per day, which was 1.4 times larger than the 9.6 mbpd produced by Saudi Arabia. Oil imports from Saudi Arabia amounted to about 269 thousand barrels per day, representing a mere 1.3% of total U.S. oil consumption of 20.9 mbpd.
In 2023, China accounted for 23% of total Saudi oil exports of 7 mbpd. Clearly, China, not the U.S., will be the anchor of Saudi Arabia’s economic security for the foreseeable future.
The challenge for Saudi Arabia will be to ensure that it can sustain oil exports to generate revenues to finance continued economic growth and development. Saudi Arabia consumes all its gas production, so it is not an exporter of natural gas.
According to the Kingdom’s Vision 2030 growth framework, the long-term target real rate of growth is expected to be about 4% to 5% per annum. The International Monetary Fund projects real GDP growth of 5.5% for 2027.
In 2025, the Kingdom’s domestic oil consumption amounted to 3.7 mbpd. The key drivers of domestic energy consumption are electric power and transportation. If the annual rate of growth of domestic oil consumption is 5% (about the same as the rate of growth of the economy), then in twenty years, Saudi Arabia’s annual oil consumption will amount to about 10 mbpd. Saudi Arabia’s peak oil production was 10.6 mbpd in 2016.
So, within a generation, if the Kingdom continues on its present trajectory, it runs a real risk of morphing from a major oil exporter into an oil importer and becoming strategically irrelevant.
Manifestly, for Saudi Arabia it is a matter of existential necessity to switch its domestic energy consumption from non-renewable oil and gas to renewables — nuclear, solar, and batteries.
AMERICA’S NUCLEAR RESURGENCE REQUIRES MORE THAN NEW REACTORS
With respect to solar and battery energy alternatives, China controls the relevant technology and critical minerals supply lines. The United States is simply not a significant player. With respect to civilian nuclear energy, Russia, China, and Pakistan are standing in line, ready and willing to help the Kingdom. America, however, has a formidable comparative advantage in nuclear energy.
President Donald Trump is right to seize this unique commercial opportunity to forge a new U.S.-Saudi strategic partnership on civilian nuclear energy. It’s a deal that Congress should support.
Samir Tata is the founder and president of International Political Risk Analytics, an advisory firm based in Reston, Virginia, and author of the book Reflections on Grand Strategy: The Great Powers in the Twenty-first Century.