Al-Falih has given no indication that he will alter Saudi Arabia’s current production policy. The 80-year-old oil minister was seen retiring eventually, but he was unable to conclude his two-decade career favorably with the June 2 OPEC meeting.
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Falih’s comments were in line with analysts’ views that no shift in Saudi oil policy is likely as a result of his appointment.
Prince Mohammed bin Salman, now assuming effective control over Saudi oil policy, has stated that the country could increase output to 11.5 million barrels a day immediately and go to 12.5 million in six to nine months.
Saudi Arabia’s King Salman named Khalid al-Falih, who had been health minister, to the post. “It represents a continuation of the path they’ve been on”.
According to the policy’s visionary, Deputy Crown Prince Muhammad, the strategy includes the National Transformation Plan and is aimed to get Saudi Arabia off the oil needle by 2020.
“This guy is the new power broker in that country”, Phil Flynn, a senior market analyst at Price Futures Group, told MarketWatch. Prince Mohammed on April 25 unveiled the Vision 2030 outlining economic reform for the next 15 years.
That policy has been one of high crude production despite low oil prices.
Since 2014, Saudi Arabia has led the Organization of the Petroleum Exporting Countries (OPEC) through a strategy of defending market share rather than reducing production to support prices.
Oil prices rose about 2 percent in early Asian trading on Monday as supply outages persisted over the weekend from Canada’s wildfires that have shut half the country’s vast oil sands capacity, Reuters reported.
Businesses and jobs not only in the oil industry, but across all business sectors could be affected one way or the other.
“What you are seeing in Saudi Arabia is a genuine need for reform that is felt at the very top of the ruling establishment”, said Mr Adeel Malik, Globe fellow in the economies of Muslim societies at Oxford University.
The first part of the shipbuilding complex, part of Riyadh’s plans to boost industrial diversification, will be ready by 2018, and it will eventually build oil rigs and tankers, Nasser said.
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Mr Naimi was dismissed by the Saudi government in a short statement late on Saturday afternoon as part of a wider government reshuffle. “The market remains awash with oil as rising Middle Eastern output is more than offsetting declining USA shale production and the various temporary disruptions”, Norbert Ruecker, head of commodities research at Julius Baer, said.
