RIYADH (Reuters) – U.S. President Donald Trump signed a strategic economic agreement with Saudi Arabia on Tuesday as the oil power rolled out the red carpet for him at the start of a tour of Gulf states aimed at drumming up trillions of dollars in investments.

Trump punched the air as he emerged from Air Force One to be greeted by Prince Mohammed bin Salman, who later signed an agreement with the president which Saudi state television said covered energy, defence, mining and other areas.

The White House said Saudi Arabia was set to invest $600 billion in the United States, including the largest defence sales agreement between the allies, worth nearly $142 billion.

“I really believe we like each other a lot,” Trump said during a meeting in Riyadh with the crown prince, Saudi Arabia’s de facto ruler.

Trump, who is accompanied by a host of U.S. business leaders including billionaire Elon Musk, will go on from Riyadh to Qatar on Wednesday and the United Arab Emirates on Thursday.

He has not scheduled a stop in Israel, a decision that has raised questions about where the close ally stands in Washington’s priorities, and the focus of the trip is on investment rather than security matters in the Middle East.

“While energy remains a cornerstone of our relationship, the investments and business opportunities in the kingdom have expanded and multiplied many, many times over,” Saudi Investment Minister Khalid al-Falih said as he opened the forum.

“As a result … when Saudis and Americans join forces very good things happen, more often than not great things happen when those joint ventures happen,” he said before Trump’s arrival.

In a meeting at the Royal Court, Trump called the Saudi crown prince a friend and said they have a good relationship, according to a pool report from the Wall Street Journal.

Trump recalled travelling to the kingdom in 2017 and said Saudi investment would help create jobs in the U.S.

He said jokingly that a $600-billion investment pledge by Saudi Arabia could be $1 trillion, repeating a figure he has cited before as he seeks investment from an important strategic partner.

Big Investments

Riyadh hosted a Saudi-US investment forum as Trump visited, with attendees including Larry Fink, the CEO of asset management firm BlackRock, Stephen A. Schwartzman, CEO of asset manager Blackstone, and Treasury Secretary Scott Bessent.

Musk chatted briefly with both Trump and the crown prince, who is otherwise known as MbS, during a palace reception for the U.S. president. And joining Trump for a lunch with MbS were top U.S. businessmen including Musk, the Tesla and SpaceX chief, and OpenAI CEO Sam Altman.

MbS has focused on diversifying the kingdom’s economy in a major reform programme dubbed Vision 2030 that includes “Giga-projects” such as NEOM, a futuristic city the size of Belgium. Oil generated 62% of Saudi government revenue last year.

“About a billion dollars of investment is being made in frontier technologies and obviously it is no surprise that the lion’s share’s of these investments has gone into U.S. companies,” NEOM Deputy CEO Rayan Fayez told the forum.

The kingdom has scaled back some of its ambitions as rising costs and falling oil prices weigh.

Saudi Arabia and the U.S. have maintained strong ties for decades based on an ironclad arrangement in which the kingdom delivers oil and the superpower provides security in exchange.

MbS’ ties with Trump have been smoother than with his predecessor, Joe Biden. Their relations were strained by the 2018 killing of Saudi commentator Jamal Khashoggi by Saudi agents in the Saudi consulate in Istanbul. U.S. intelligence believed the killing was ordered by MbS. He denied involvement.

Trump has not included Israel on his schedule although he wants Israeli Prime Minister Benjamin Netanyahu to agree a new ceasefire deal in the Gaza war.

Israeli officials have put a brave face on Trump’s decision but there are growing doubts in Israel about its position in his priorities as frustration mounts in Washington over the failure to end the war.

Israel’s military operations against Hamas in Gaza and Hezbollah in Lebanon, and its assassinations of the two Iran-allied groups’ leaders, have at the same time given Trump more leverage by weakening Tehran and its regional allies.

U.S. and Iranian negotiators met in Oman at the weekend to discuss a potential deal to curb Tehran’s nuclear program. Trump has threatened military action against Iran if diplomacy fails.

Trump is expected to offer Saudi Arabia, Iran’s regional rival, an arms package worth more than $100 billion, sources told Reuters. This could include a range of advanced weapons.

Trump’s Middle East envoy, Steve Witkoff, said last week he expected progress imminently on expanding accords brokered by Trump in his first term under which Arab states including the UAE, Bahrain and Morocco recognised Israel.

But opposition by Netanyahu to a permanent stop to the war in Gaza or to the creation of a Palestinian state makes progress on similar talks with Riyadh unlikely, sources told Reuters.

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(Reporting by Gram Slattery, Pesha Magid, Yousef Saba, Federico Maccioni and Nafisa Eltahir in Riyadh; Writing by Michael Georgy; Editing by Alistair Bell, Clarence Fernandez and Timothy Heritage)