A reshuffle of the leadership in Saudi Arabia and at its state-run energy firm is unlikely to change the oil policy of the world’s biggest crude exporter, analysts said yesterday.
King Salman, who became ruler in January following the death of King Abdullah, yesterday appointed the interior minister Mohammed bin Nayef as the new crown prince, replacing the king’s half brother Prince Muqrin and gave Adel Fakeih, the labour minister, the economy and planning portfolio.
King Salman also announced the appointment of the Saudi Aramco chief executive and president Khalid Al Falih as the country's health minister. He also replaced the veteran oil minister Ali Al Naimi as Aramco's chairman.
Saudi shares reacted positively yesterday, with the benchmark Tadawul index closing 1 per cent higher at 9,812.40.
These changes have fuelled talk that Mr Al Naimi could be replaced as oil minister. In the past the chairman of Saudi Aramco has gone on to that position. Mr Al Naimi, who has been in his post as oil minister for two decades, was himself president of Saudi Aramco.
“Al Naimi’s oil minister’s clock was already ticking before the death of King Abdullah, the ticking is now getting much louder,” said Olivier Jakob, managing director of Switzerland-based consultancy Petromatrix. “This is probably not the last reshuffle and we need to keep in mind that the king’s son, Prince Abdulaziz, as deputy oil minister is also still waiting in the wings for a more rewarding position.”
The post of oil minister is usually held by a technocrat such as Mr Al Naimi, but the appointment of a royal to the post could have severe implications on the Saudi oil policy, which is currently aimed at maintaining market share amid tumbling oil prices.
“Will Al Falih become oil minister, which would be most in line with the ‘tradition’ of promoting the top oil technocrat to the post?” said Samuel Ciszuk, an analyst at the Swedish Energy Agency. Not having the ‘buffer’ of a technocrat at the oil ministry would risk the [royal] family being held more accountable domestically for oil market movements. Consequentially, longer term, that could politicise Saudi oil policies more.”
Saudi Arabia, the Opec kingpin, has angered some of the organisation's hawks, such as Venezuela, by refusing at November's meeting to cut output to shore up falling oil prices. The organisation next meets in June to decide on its output quota, which has not changed since 2008.
Brent oil prices have fallen by about 45 per cent since last June on the back of weaker demand in Asia and Europe and an oil supply glut.
But the recent Saudi military involvement in Yemen has helped to push Brent higher, above $60 per barrel, after it reached $43.5 a barrel in March.
Brent crude oil fell yesterday 0.05 per cent to $64.6 per barrel in London noon trading.
“I do not expect to see any movement on the stance towards Opec, in that the kingdom will only consider a reduction in the production quota if all Opec members and even some non-Opec producers collectively cut output,” said Richard Mallinson, a geopolitical analyst at the London-based consultancy Energy Aspects. “As that looks very unlikely, the quota is almost certain to be rolled over in June.”
In respect to the Saudi economy, the appointment of the labour minister as economy minister could mean there will be stepped-up efforts to enforce Saudisation, said Jason Tuvey, Middle East economist for Capital Economics in a note.
This is particularly so since Mr Fakeih was responsible for implementing the Nitaqat programme aimed at helping Saudis become employed in the private sector, he added.
dalsaadi@thenational.ae
Follow The National's Business section on Twitter
At a glance
Global events: Much of the UK’s economic woes were blamed on “increased global uncertainty”, which can be interpreted as the economic impact of the Ukraine war and the uncertainty over Donald Trump’s tariffs.
Growth forecasts: Cut for 2025 from 2 per cent to 1 per cent. The OBR watchdog also estimated inflation will average 3.2 per cent this year
Welfare: Universal credit health element cut by 50 per cent and frozen for new claimants, building on cuts to the disability and incapacity bill set out earlier this month
Spending cuts: Overall day-to day-spending across government cut by £6.1bn in 2029-30
Tax evasion: Steps to crack down on tax evasion to raise “£6.5bn per year” for the public purse
Defence: New high-tech weaponry, upgrading HM Naval Base in Portsmouth
Housing: Housebuilding to reach its highest in 40 years, with planning reforms helping generate an extra £3.4bn for public finances
NO OTHER LAND
Director: Basel Adra, Yuval Abraham, Rachel Szor, Hamdan Ballal
Stars: Basel Adra, Yuval Abraham
Rating: 3.5/5
ESSENTIALS
The flights
Emirates flies direct from Dubai to Rio de Janeiro from Dh7,000 return including taxes. Avianca fliles from Rio to Cusco via Lima from $399 (Dhxx) return including taxes.
The trip
From US$1,830 per deluxe cabin, twin share, for the one-night Spirit of the Water itinerary and US$4,630 per deluxe cabin for the Peruvian Highlands itinerary, inclusive of meals, and beverages. Surcharges apply for some excursions.
Real estate tokenisation project
Dubai launched the pilot phase of its real estate tokenisation project last month.
The initiative focuses on converting real estate assets into digital tokens recorded on blockchain technology and helps in streamlining the process of buying, selling and investing, the Dubai Land Department said.
Dubai’s real estate tokenisation market is projected to reach Dh60 billion ($16.33 billion) by 2033, representing 7 per cent of the emirate’s total property transactions, according to the DLD.
Our legal consultant
Name: Dr Hassan Mohsen Elhais
Position: legal consultant with Al Rowaad Advocates and Legal Consultants.
A MINECRAFT MOVIE
Director: Jared Hess
Starring: Jack Black, Jennifer Coolidge, Jason Momoa
Rating: 3/5
SPECS
Engine: 4-litre V8 twin-turbo
Power: 630hp
Torque: 850Nm
Transmission: 8-speed Tiptronic automatic
Price: From Dh599,000
On sale: Now
Dr Graham's three goals
Short term
Establish logistics and systems needed to globally deploy vaccines
Intermediate term
Build biomedical workforces in low- and middle-income nations
Long term
A prototype pathogen approach for pandemic preparedness
WRESTLING HIGHLIGHTS
SHALASH%20THE%20IRAQI
%3Cp%3EAuthor%3A%20Shalash%3Cbr%3ETranslator%3A%20Luke%20Leafgren%3Cbr%3EPages%3A%20352%3Cbr%3EPublisher%3A%20And%20Other%20Stories%3C%2Fp%3E%0A
Name: Colm McLoughlin
Country: Galway, Ireland
Job: Executive vice chairman and chief executive of Dubai Duty Free
Favourite golf course: Dubai Creek Golf and Yacht Club
Favourite part of Dubai: Palm Jumeirah
more from Janine di Giovanni
The specs
Engine: 3-litre twin-turbo V6
Power: 400hp
Torque: 475Nm
Transmission: 9-speed automatic
Price: From Dh215,900
On sale: Now
Key facilities
- Olympic-size swimming pool with a split bulkhead for multi-use configurations, including water polo and 50m/25m training lanes
- Premier League-standard football pitch
- 400m Olympic running track
- NBA-spec basketball court with auditorium
- 600-seat auditorium
- Spaces for historical and cultural exploration
- An elevated football field that doubles as a helipad
- Specialist robotics and science laboratories
- AR and VR-enabled learning centres
- Disruption Lab and Research Centre for developing entrepreneurial skills
The specs: 2018 Jaguar E-Pace First Edition
Price, base / as tested: Dh186,480 / Dh252,735
Engine: 2.0-litre four-cylinder
Power: 246hp @ 5,500rpm
Torque: 365Nm @ 1,200rpm
Transmission: Nine-speed automatic
Fuel consumption, combined: 7.7L / 100km
Sreesanth's India bowling career
Tests 27, Wickets 87, Average 37.59, Best 5-40
ODIs 53, Wickets 75, Average 33.44, Best 6-55
T20Is 10, Wickets 7, Average 41.14, Best 2-12
The specs
AT4 Ultimate, as tested
Engine: 6.2-litre V8
Power: 420hp
Torque: 623Nm
Transmission: 10-speed automatic
Price: From Dh330,800 (Elevation: Dh236,400; AT4: Dh286,800; Denali: Dh345,800)
On sale: Now
2025 Fifa Club World Cup groups
Group A: Palmeiras, Porto, Al Ahly, Inter Miami.
Group B: Paris Saint-Germain, Atletico Madrid, Botafogo, Seattle.
Group C: Bayern Munich, Auckland City, Boca Juniors, Benfica.
Group D: Flamengo, ES Tunis, Chelsea, (Leon banned).
Group E: River Plate, Urawa, Monterrey, Inter Milan.
Group F: Fluminense, Borussia Dortmund, Ulsan, Mamelodi Sundowns.
Group G: Manchester City, Wydad, Al Ain, Juventus.
Group H: Real Madrid, Al Hilal, Pachuca, Salzburg.
WHAT IS A BLACK HOLE?
1. Black holes are objects whose gravity is so strong not even light can escape their pull
2. They can be created when massive stars collapse under their own weight
3. Large black holes can also be formed when smaller ones collide and merge
4. The biggest black holes lurk at the centre of many galaxies, including our own
5. Astronomers believe that when the universe was very young, black holes affected how galaxies formed
The%20specs%20
%3Cp%3E%3Cstrong%3EEngine%3A%20%3C%2Fstrong%3EDual%20permanently%20excited%20synchronous%20motors%3Cbr%3E%3Cstrong%3EPower%3A%20%3C%2Fstrong%3E516hp%20or%20400Kw%3Cbr%3E%3Cstrong%3ETorque%3A%20%3C%2Fstrong%3E858Nm%3Cbr%3E%3Cstrong%3ETransmission%3A%20%3C%2Fstrong%3ESingle%20speed%20auto%3Cbr%3E%3Cstrong%3ERange%3A%20%3C%2Fstrong%3E485km%3Cbr%3E%3Cstrong%3EPrice%3A%20%3C%2Fstrong%3EFrom%20Dh699%2C000%3C%2Fp%3E%0A
