Saudi King separates Aramco from oil ministry, benchmarks fall on Iraqi production

Aramco, Saudi Arabia’s national oil company, is to be separated from the country’s oil ministry following an edict issued by King Salman.

Saudi state TV said the move was part of “wider restructuring” of Aramco. The decision was approved by the country’s the Supreme Economic Council, set up by King Salman this year, to replace the Supreme Petroleum Council.

Prince Mohammed bin Salman, appointed this week as the new deputy crown prince, would be heading the 10-member council. On Wednesday, King Salman appointed Saudi Aramco chief executive Khalid al-Falih as chairman of the company replacing oil minister Ali Al-Naimi who held the post along with his ministerial portfolio.

He has since been replaced by Aramco’s senior vice-president Amin al-Nasser.

Earlier this year, King Salman promoted his son, Prince Abdulaziz bin Salman to the role of deputy oil minister from assistant oil minister. According market analysts, the ongoing overtures could lay the foundation for a royal family member to replace the 79-year old Al-Naimi as oil minister.

However, there are no suggestions the move would indicate a shift in Saudi Arabia’s policy stance at OPEC where it has strongly argued for maintaining the cartel’s quota at its current level of 30 million barrels per day.

Aramco has declined to comment formally on the shake-up, with a spokesperson saying it was a “government matter”.

Meanwhile, oil futures retreated marginally in early US trading on Friday, following reports that Iraq’s crude exports had risen to a 30-year high as production from the OPEC stood at its highest level since late 2012.

At 15:55 BST, Brent was down 58 cents or 0.87% at $66.20 per barrel while the WTI was down 65 cents or 1.09% at $58.98 per barrel.