While the secretaries-general don't set OPEC production policy, they do act as the group's public face Image Credit: AFP

OPEC chose veteran Kuwaiti oil executive Haitham Al Ghais to become the organisation’s top diplomat, as the group and its allies navigate a delicate recovery from the pandemic.

Al Ghais, a multilingual technocrat whose three-decade oil industry career includes stints in Beijing and London, will become Secretary-General in August, taking over from Mohammad Barkindo, according to a statement from the Organiaation of Petroleum Exporting Countries on Monday.

His appointment comes at a time when OPEC and its partners tread a narrow path, seeking to satisfy the recovery in oil consumption without tipping markets back into oversupply. The OPEC+ coalition is expected to approve another modest resumption of supplies when it meets on Tuesday.

“He knows OPEC inside and out,” said Johannes Benigni, chairman of consultant JBC Energy Group in Vienna. “At the same time, he knows the ins and outs of the market. He’s very smart and a good analyst.”

While the secretaries-general don’t set OPEC production policy, they do act as the group’s public face - and as an intermediary seeking compromise between often-fractious members.

It’s a sensitive task now as oil’s return to almost $80 a barrel stirs fears over inflation in major consumers like the US - where lawmakers occasionally invoke threats of anti-competition legislation - and as climate change accelerates a transition away from fossil fuels.

Balancing act

The diplomatic balancing act is a mission to which Al Ghais brings a number of strengths.

Having previously served as a diplomat, he subsequently held a number of positions at state-run Kuwait Petroleum Corp., most recently as deputy managing director for international marketing. Al Ghais also acted as the country’s liaison to OPEC from 2017 until last year.

The appointment of a Kuwaiti as OPEC chief marks a shift for the group, which has typically awarded the post to candidates from smaller producers to offset the concentration held by its Gulf heavyweights. Smaller members will likely monitor whether he can act as a counterbalance to the group’s most influential nation, Saudi Arabia. Al Ghais was the only candidate, and was appointed by acclamation rather than a ballot on Monday.

“I would like to offer my cordial congratulations to HE Haitham Al Ghais on his appointment, by acclamation, as the next Secretary General of OPEC,” Saudi energy minister Prince Abdulaziz bin Salman Prince Abdulaziz said in a statement.

As incumbent secretary-general, Barkindo steps down in July after completing the full six years permitted by the cartel’s rules, having played a pivotal role in the creation of OPEC+ in late 2016. Prince Abdulaziz has proposed a farewell party with ministers in Vienna before he leaves, according to a person familiar with the situation. Ministers have been meeting virtually throughout the pandemic.