Oil prices jump as Saudi King Abdullah death announced

PanARMENIAN.Net - Saudi King Abdullah bin Abdulaziz has died in hospital, royal officials have announced. A statement early on Friday, Jan 23 said his half brother, Salman, has become king, BBC News reports.

Before the announcement, Saudi television cut to Koranic verses, which often signifies the death of a senior royal.

King Abdullah, who was said to be aged about 90, had been in hospital for several weeks suffering from a lung infection.

Abdullah came to the throne in 2005 but had suffered frequent bouts of ill health in recent years. King Salman, 79, had recently taken on the ailing monarch's responsibilities.

The late king's half brother Muqrin, who is in his late 60s, has been named the new crown prince, the official statement said.

The BBC says Saudi Arabia could face an increasing internal security problem following the death of King Abdullah.

All three are sons of the founder of modern Saudi Arabia, King Abdulaziz, usually referred to as Ibn Saud, who died in 1953.

King Salman called on the royal family's Allegiance Council to recognize Muqrin as his crown prince and heir.

"His Highness Salman bin Abdulaziz Al Saud and all members of the family and the nation mourn the Custodian of the Two Holy Mosques King Abdullah bin Abdulaziz, who passed away at exactly 1am this morning," the statement said.

Abdullah was the 13th of the 37 sons of King Abdulaziz. He is believed to have been born in August 1924 in Riyadh, although there is some dispute about his actual birth date. In 1962 he was appointed commander of the Saudi National Guard, where he earned the respect and loyalty of the desert tribes.

When he came to the throne in 2005 he succeeded another half-brother, Fahd. However, he had already been Saudi Arabia's de-facto leader for 10 years because his predecessor had been debilitated by a stroke.

Correspondents say Abdullah was seen as a reformer at home, albeit a slow and steady one. He allowed mild criticism of his government in the press, and hinted that more women should be allowed to work.

King Salman spent 48 years as governor of Riyadh Province before becoming crown prince and defense minister.

Following the news of King Abdullah’s death, crude oil spiked 2.5 percent. The prices have fallen by half in the past year, dropping 3 percent earlier in the day before the death of the 90-year-old leader was announced.

Crude oil is now trading just above $47 a barrel.

Saudi Arabia is now the world’s second-largest energy producer, behind the U.S., which became No. 1 this year. The Saudis have a great amount of control over where world energy prices go. They’ve been continuing to produce large amounts of oil, even as prices are tanking, which in turn has driven prices lower.