The recent dismissal of Ali al-Naimi, the influential and long-serving Saudi Arabian oil minister suddenly changes the temperament of the oil price game. While Mr. Falih said in a news release that the country would “remain committed to maintaining our role in global energy markets and strengthening our position as the world’s most reliable supplier of energy” the market will want more proof. Through boom and bust cycles he repeatedly emphasised that Riyadh’s oil policy was driven by market forces and not politics.
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Falih was also instrumental in demanding Iran join any sort of worldwide agreement to freeze oil export levels.
Matt Smith, director of commodity research at ClipperData, says that timing is the most surprising aspect of al-Naimi’s replacement.
Hamade also noted that it will “take time” for Falih to gain the worldwide respect that his predecessor spent 20 years developing. In addition to having served as health minister, al-Falih had previously been the CEO of Aramco from 2009 until his appointment as board chairman in May 2015.
“We will resort to any move to regain Iran’s lost share in the oil market and increase the country’s production to four million bpd”, Zangeneh has been quoted by the media as saying. “The minister of petroleum just executes policy”, he said in an interview with CNBC’s “Power Lunch “.
The Ministry of Petroleum will also be renamed to the Ministry of Energy, Industry, and Natural Resources.
Mr. Nasser said Aramco expected demand to grow by about 1.2 million barrels a day across the world this year, in line with other analysts’ estimates. China’s crude imports rose 7.6% on-year last month close to 7.9 million barrels a day in April. “In our view, while it makes for a big news headline, it does not represent a shift in the Kingdom’s current oil policy”, she said.
Over the weekend, Saudi King Salman issued a whole raft of Royal decrees implementing huge changes in the make-up of the country’s most important officials.
Canadian energy company Suncor had about 10,000 of its employees evacuated from an oil sands operation near Fort McMurray as wildfires rage across the region. All this means uncertainty – the thing oil markets hate.
Khaled al-Falih, the longtime head of state oil giant Saudi Aramco, was appointed in a major reshuffle in OPEC’s largest oil exporter, which is moving to transform the economy by reduce its dependence on crude.
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According to al-Falih “If prices continue to be low we will be able to withstand it for a long, long time”.
