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Dhahran is located in Saudi Arabia's Eastern Province, and is a major administrative center for the Saudi oil industry. Large oil reserves were first identified in the Dhahran area in 1931, and in 1935 Standard Oil of California (now Chevron Corporation) drilled the first commercially viable oil well. Standard Oil later established a subsidiary in Saudi Arabia called the Arabian American Oil Company (ARAMCO), now fully owned by the Saudi government as Saudi Aramco.
Dhahran is a short distance west of downtown Al-Khobar. It is about 15 kilometres (9.3 mi) south of Dammam. Both are older Saudi port cities on the Persian Gulf. Looking farther afield, Dhahran is northeast of Abqaiq, and southeast of Qatif and, further north, Ras Tanura, a major oil port. The island nation of Bahrain is also within easy driving distance to the east (about 20 miles (32 km)), across the King Fahad Causeway, from Al-Khobar.

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