Dubbed the “Greenspan of oil,” Minister of Petroleum and Mineral Resources Ali Al-Naimi has begun his fourth term in the Saudi cabinet as the person responsible for managing the global “gas station” that Saudi Arabia is. To the already disturbed, itchy and somewhat nervous crude markets, this marks continuity and stability in policies and positions of the world’s largest crude producer and exporter.
Al-Naimi, the veteran of the oil industry, is faced at times with conflicting and contradictory demands. This is indeed one of the hottest seats to occupy in the world. On one hand, he has to manage and secure regular flow of petro-dollars into the country so as to keep the finances in balance and at the same time he has to ensure that the global economy is not pushed into a recessionary phase because of higher and unbearable oil prices. Operating in volatile market conditions, so as to ensure “fair returns” for the black gold, is a difficult balancing act. Yet Al-Naimi appears apt at it. He has succeeded as yet. Today he is regarded as the architect of a “very successful and consistent OPEC strategy.”
The industry veteran would continue to guide the policies and actions of the world’s largest oil exporter at a time, when the two next biggest producers after the Kingdom within the OPEC, Iran and Venezuela, are at loggerheads and engaged in military and political standoff with the world’s largest consumer — the United States.
After all Al-Naimi has been a known face within the oil industry and speaks up for stability, continuity and reliability in the sector. His words carry weight. Familiar with Al-Naimi as the most influential minister in the Organization of the Petroleum Exporting Countries over the past 12 years, the global energy fraternity welcomed his reappointment in these turbulent times. “It’s a relief for the world oil market to know that Ali Al-Naimi is to stay on as oil minister,” said Gary Ross, chief executive at US energy consultancy PIRA Energy.
Al-Naimi is also credited with the smoothing of divisions among Opec members, reviving its power as prices went up fivefold from 1998’s record low, said Anthony Nunan, an oil trader at Mitsubishi Corp in Tokyo. As the oil prices were at historic lows then, Al-Naimi aggressively pushed forward the idea of greater cooperation and coordination within OPEC, to ensure better, “fair return”.
Al-Naimi has not solely been focused on maximizing returns to the oil producers. He has his eyes set on the market. He also doesn’t want the industry to be forced to start looking for alternatives to oil. Hence, at times, despite calls by some members, he stood his ground and ensures that enough supplies are always available to keep the wheels of global economy well oiled. This is a balancing act which few can master.
“He’s been able to drive Opec policy more clearly, he’s a very intelligent man and with him Opec has become more credible,” said Simon Chen Bo, head of trading at China International Petroleum & Chemical Corp, a unit of Asia’s largest refiner.
The demands on his job are of extreme nature.
“He’s been very sensitive about cutting production quickly to support prices, but then increasing production when it looks like it will go high enough to start wrecking economies,” said Nunan, assistant general manager for risk management at Mitsubishi, Japan’s largest trading company, in Tokyo.