Saudi Arabia officially known as the Kingdom of Saudi Arabia is the largest Arab state in Western Asia by land area, constituting the bulk of the Arabian Peninsula, and the second-largest in the Arab world (after Algeria). It is bordered by Jordan, and Iraq on the north and northeast, Kuwait, Qatar, Bahrain and the United Arab Emirates on the east, Oman on the southeast, and Yemen on the south. The Red Sea lies to its west, and the Persian Gulf lies to the east. Saudi Arabia has an area of approximately 2,250,000 km (870,000 sq mi), and it has an estimated population of 27 million, of which 9 million are registered foreign expatriates and an estimated 2 million are illegal immigrants. Saudi nationals comprise an estimated 16 million people.
The Kingdom of Saudi Arabia was founded by Abdul-Aziz bin Saud (known for most of his career as Ibn Saud) in 1932, although the conquests which eventually led to the creation of the Kingdom began in 1902 when he captured Riyadh, the ancestral home of his family, the House of Saud, referred to in Arabic as Al Saud. The Saudi Arabian government, which has been an absolute monarchy since its inception, refers to its system of government as being Islamic, though this is contested by many due to its strong basis in Wahhabism and Salafism, which are minority schools of thought in Islam. The kingdom is sometimes called "The Land of the Two Holy Mosques" in reference to Al-Masjid al-Haram (in Mecca), and Al-Masjid al-Nabawi (in Medina), the two holiest places in Islam.
Saudi Arabia has the world's second largest oil reserves which are concentrated largely in the Eastern Province and oil accounts for more than 95% of exports and 70% of government revenue. This facilitates the creation of a welfare state although the share of the non-oil economy is growing recently. It has also the world's sixth largest natural gas reserves