Saudi Aramco: A reorganization reflecting the new balance of power in the Kingdom


Deputy Crown Prince Mohammed bin Salman was appointed chairman of Aramco’s newly established Supreme Council (saudiaramco.com, 29/04), confirming the hold of King Salman’s clan over energy in Saudi Arabia.

The appointment is part of a vast internal reshuffling initiated by the new King since his accession to the throne in January 2015. Two parallel trends are emerging:

– Salman’s clan, led by Deputy Crown Prince MBS but also his brother, Abdulaziz bin Salman, Deputy Minister of Petroleum, is consolidating its hold over energy in the Kingdom: MBS as head of the Council of Economic and Development Affairs and chairman of Aramco’s Supreme Council, and ABS as Deputy Minister of Petroleum (and a possible new role?);

– Crown Prince Mohammed bin Nayef, Minister of Interior and head of the newly-created Council of Political and Security Affairs, widely acclaimed for his counter-terrorism skills, confirms his hold over security in the Kingdom, even more so now with the weakening of Prince Mitaab bin Abdullah, Minister of the National Guard (now deployed on the border with Yemen, far from the decision-making center). After excelling in ensuring the protection of Saudi oil facilities, with notable help and training from his American partners, with whom he shares the same security concerns, MBN is expected to be responsible of securing offshore petroleum facilities, at the expense of other security agencies, who might, at first, appear to be more apt for the job (such as the RSN).

By separating Aramco from the Petroleum Ministry, the move weakens Petroleum Minister Ali al-Naimi, King Abdullah’s protégé who put much effort to impose the late King’s vision for Aramco. More direct interference from the Court is to be expected now, in a way shifting Saudi Aramco towards a Sudairy Aramco.

The Supreme Petroleum Council, which previously set oil policy and was headed by the king, will be dissolved. This in itself is significant. MBS is aware that his father’s tenure as King is not expected to last for a long time and is consolidating his influence early on, by among other things heading Aramco’s Supreme Council. This, he hopes, would ensure he has a say in energy affairs, even after the reign of his father, when the next monarch – MBN if everything goes as planned at this stage – accedes to the throne.

Both MBN and MBS are expected to be influential in inspiring the Kingdom’s energy policy, the first through his clout, the second in a more personal and direct way. Respectively Crown Prince and Deputy Crown Prince, MBN and MBS still have to demonstrate their ability to work together, in harmony. Cohabitation, under the present circumstances, is a pragmatic choice that is now further needed in light of the destabilization of traditional intra-family arrangements.

The above is part of a report conducted by MESP including an updated cartography of the actors influencing the decision-making process in the petroleum sector. If interested, please contact us for more details.

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Update: In a series of tweets, Saudi whistleblower @Mujtahidd addresses the recent restructuring of Aramco and notes that “production, pricing, exports and revenue management are now concentrated in the hands of MBS and a narrow circle of trusted princes and aides”. In effect, this would be akin to “taking the country 80 years back, when King Abdelaziz used to manage oil revenues directly and assign a portion for public spending”. Such a concentration of power and money is a “major source of concern for MBN”, according to @Mujtahidd. The Crown Prince supposedly fears a future marginalization, and would be “helpless in the face of a royal decision stripping him of his powers as Minister of Interior or as head of the Council of Political and Security Affairs”.

While true in theory, it must be noted that other parameters must be taken into account when it comes to MBN and his position in the Kingdom, including his control of the country’s security (with an excellent record), and special relation with the Americans. Another important element: an excessive concentration of power in the hands of MBS would not only threaten family cohesion but also attract trouble for the ambitious but young and fairly inexperienced deputy Crown Prince.

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Tags: Aramco, Abdulaziz bin Salman, Ali al-Naimi, King Salman, Mohammed bin Salman, Mohammed bin Nayef, Supreme Economic Council, Supreme Council of the Saudi Arabian Oil Company, Supreme Petroleum Council, Khalid al-Falih, Amin Nasser

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