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Saudi Arabia’s Longest-Serving Oil Minister Dies At 90

The driving force of the 1973 oil embargo, Sheikh Ahmed Zaki Yamani, has died at age 90.

Yamani served as Saudi Arabia's Oil Minister from 1962 until 1986, when he was dismissed by Saudi King Fahd over differing opinions on the Kingdom's oil policies.

He is Saudi Arabia's longest-serving oil minister.

The simple explanation of the disagreement between the King and Yamani was that when it came to oil policy and delicate OPEC negotiations, Fahd wanted oil prices to be 25% higher and expected Yamani's OPEC negotiations to deliver that result. But Fahd was also disappointed with Yamani's inability to maintain Saudi Arabia's oil market share.

Yamani, on the other hand, was adamant that you couldn't have both higher prices and more market share.

The result of the spat, other than Yamani being removed from his post, was similar to what happened in March 2020. Saudi Arabia flooded the world with oil in an attempt to regain its market share.

Oil prices sank to just $8 per barrel.

When Yamani began his role as oil minister in 1962, the United States was the leading oil producer, with Saudi Arabia producing less than 2 million barrels per day. And Exxon and Chevron had control of most of the oil in Saudi Arabia. But that quickly changed as Saudi Arabia moved to nationalize its oil industry. Saudi Arabia's oil production quickly reached 10 million bpd during Yamani's tenure.

Chart courtesy of Dr. Anas Alhajji

Within oil circles, Yamani is known for increasing Saudi Arabia's spare production capacity and shaping oil policy—something that has no doubt changed the face of the oil industry, giving OPEC much of the clout is has today.

Outside the oil sphere, he is most widely known for his visible role in the 1973 oil embargo that saw crude oil and gasoline prices skyrocket.

"He will remain an integral part of the history of the oil industry that he played a significant role in shaping it, "Dr. Anas Alhajji said of Yamani on Twitter.

By Julianne Geiger for Oilprice.com

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  • Mamdouh Salameh on February 23 2021 said:
    The late Sheikh Ahmed Zaki Yamani who passed away today was a legend in the global oil market. He was the face of Saudi Arabia for more than two decades and the most popular Saudi as the Americans described him.

    Sheikh Yamani was a towering figure in OPEC when he served as the oil minister of Saudi Arabia. He always dominated negotiations at OPEC and had his views prevail.

    While Saudi oil minister, he was for a time one of the most powerful men on earth. For over two decades as both oil minister and the leading force behind OPEC, Yamani was the star player of the world’s biggest business, the supreme negotiator in the most volatile market and the ultimate diplomat in the shifting sands of Saudi politics.

    The late Saudi King Faisal appointed him as an oil minister when he was 32 years old. Over the next two decades he wrestled control of Saudi Aramco from the Americans and helped turn OPEC into a major force in the global oil market.

    His greatest legacy by which he will always be remembered is that he orchestrated under the astute leadership of King Faisal the Arab oil weapon during the 1973 October War between Egypt and Syria on the one hand and Israel on the other. He will also be remembered as having been the nemesis of the late Shah of Iran because they always differed on OPEC oil policies.

    Sheikh Yamani continued to serve as the oil minister of Saudi Arabia until October 1986 when a terse one-sentence edict issued on behalf of the late Saudi King Fahad brought his political career to an end over declining oil prices. King Fahd wanted Yemeni to get a bigger share of production under the OPEC production quota system for Saudi Arabia and an oil price higher than what the market can take. Yamani is reported to have told the King that you can’t square a circle.

    May God rest his soul in peace.

    Dr Mamdouh G Salameh
    International Oil Economist
    Visiting Professor of Energy Economics at ESCP Europe Business School, London

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