London — Sheikh Ahmed Zaki Yamani, the former long-serving Saudi oil minister who died Feb. 23, helped bring the kingdom onto the world stage as an oil superpower but also gave OPEC a reputation for geopolitically weaponizing the market that it has struggled to shake for decades.
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The plainspoken Yamani held his powerful post for 25 years starting in 1962, when Saudi Arabia's oil industry was still in its infancy.
Less than two decades later, Saudi production had soared to around 10 million b/d, making the kingdom the world's largest crude exporter and generating enormous wealth.
Along the way, Yamani helped OPEC member states wrest control of their crude production from the international oil companies that had previously held sway, and he imposed Saudi Arabia's -- and OPEC's -- market power as oil demand steadily rose in the developed world.
"Ahmed Zaki Yamani was an outstanding icon of the world of oil and the leading light in OPEC," the organization's secretary general, Mohammed Barkindo, said in a statement. "I recall vividly and with fondness his patience and graciousness at our meetings. He was an active listener who when he spoke, everyone paid attention with what I call pin-drop silence."
In 1973, Yamani led OPEC's Arab states in embargoing oil exports to the US over its support for Israel in the Yom Kippur war, an economically devastating move that resulted in severe gasoline shortages and long queues at service stations. The episode still reverberates strongly in American politics today.
That was also when Saudi Arabia began to nationalize the Arabian American Oil Co. -- ultimately transforming it into Saudi Aramco in 1988, two years after Yamani's tenure as minister ended.
At an OPEC meeting in 1975, he was briefly taken hostage along with several other oil ministers and officials by the Venezuelan terrorist known as Carlos the Jackal, who threatened to execute him before releasing all hostages two days later.
Having survived his brush with death, in 1979 Yamani sought to help oil consuming countries by increasing Saudi crude production to offset much of Iran's losses in the wake of its revolution, though it was not enough to prevent another price spike.
FLOODING THE MARKET
By the mid-1980s, as ascendant North Sea producers brought new supplies online, prices began a multi-year slump, prompting OPEC to impose quotas in a bid to prop up the market. But tired of cheating by other members, Saudi Arabia boosted supply in 1985-86 through a price war that forced crude down below $10/b. This strategy ultimately cost Yamani his job, as the fiscal pain proved too much for Saudi Arabia to bear. He was dismissed in 1986 and replaced by Hisham Nazer.
"He will remain an integral part of the history of the oil industry because he played a significant role in shaping it," independent oil analyst Anas Alhajji said.
As the oil head of its biggest member, Yamani was the de facto leader of OPEC -- as whoever holds the post of Saudi energy minister remains today -- and his comments, closely monitored by traders, would regularly move the oil market. He remains OPEC's longest serving minister to date.
OPEC is a much more cautious organization now, maintaining that it tries to keep its decisions on production policy apolitical and aims to promote market stability instead.
After his tenure as minister, Yamani founded an energy thinktank and a private equity firm.
Yamani's best known quote appears to have presaged the global energy transition decades in advance, when he was reported to have said in 1973: "The Stone Age did not end because the world ran out of stones, and the oil age will end long before we run out of oil."
Born in the holy Islamic city of Mecca in 1930, the 90-year-old Yamani died in London, Saudi state media reported, after a long battle with illness.
Faiza al-Husseini, vice president of consultancy Husseini Energy, said Yamani's legacy also includes building Aramco's multi-billion cubic feet Master Gas System, one of the kingdom's biggest energy projects that boosted the Saudi petrochemical industry in the industrial developments of Jubail and Yanbu, while reducing the amount of crude oil burned to produce electricity.
"Zaki Yamani was a visionary leader at a time when the world was struggling to cope with the steep increase in demand for crude oil," she said.