This 14 September 2019 video says about itself:
Why was Saudi Arabia’s oil minister fired from his job? | Counting the Cost
He was the de-facto leader of OPEC and the most respected oilman in Saudi Arabia and on the world stage. So well respected that when crown prince Mohammed bin Salman needed to salvage his credibility after the killing of journalist Jamal Khashoggi, it was energy minister Khalid al-Falih who he turned to.
It is the first time that a member of the ruling Saudi family has been appointed to the post. Technocrats like al-Falih have always been the nation’s choice to run the oil ministry.
Al-Falih was also relieved from his role as chairman of the state-owned oil giant Aramco.
Saudi Arabia has a 13 percent share of the world’s petroleum market. During al-Falih’s tenure, he struggled to raise the price of oil to $80.
That price would give Mohammed bin Salman the financial firepower to transform the economy, …
Rather: to continue to wage the expensive war on Yemen.
It would also enable it to balance its budget and not exhaust foreign reserves on imports.
Oil is crucial to Saudi Arabia. It accounts for 40 percent of its economy, 70 percent of government revenue and nearly 80 percent of export earnings.
According to Reuters, Saudi export earnings from oil fell from more than $800m a day in April 2014 to less than $300m per day in February 2016 – due to the shale oil boom in the United States. In June this year, it was earning $400m a day.
Saudi Arabia has used everything in its policy toolbox to raise prices. Al-Falih elicited the help of Russia and other non-OPEC nations to cut production. Saudi Arabia cut its own production to its lowest level in five years – to no avail.
It also needs high oil prices to meet the ambitious $2 trillion valuation for Saudi Aramco‘s stock market listing early next year.
At the moment, analysts believe the world’s most profitable company is worth between $1 trillion to $1.5 trillion. But MBS wants a higher valuation and on that count al-Falih also failed to deliver.
“Saudi Arabia has ambitious investment plans, vision 2030, and other areas and so I think certainly the slow progress, as probably the Saudis would see it, towards achieving a more balanced market and the price increase they would expect to come with that is going to be a big part of what has driven this change,” Richard Mallinson, senior analyst and the co-founder of Energy Aspects, tells Counting the Cost.
According to Mallinson, Prince Abdulaziz is “very deeply involved in the (oil) industry” and is perceived “as a safe pair of hands and experienced person when it comes to oil markets”.
“I don’t think we will see a dramatically different policy. I think we may see a different style of communication perhaps, maybe a move back towards an approach we saw in the past from Saudi Arabia where there was less talk, less comment to the press. There was a narrower focus on a message that the kingdom wants to communicate to oil markets.”
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