Saudi Arabia's King Abdullah has appointed Defence Minister Prince Salman as Crown Prince and heir apparent, ensuring a smooth succession at a time of tough challenges for the world's biggest oil exporter.

The appointment, reported on state television, was announced in a royal decree one day after the burial of Crown Prince and Interior Minister Nayef, who died on Saturday.

Crown Prince Salman becomes Abdullah's third heir after the deaths of two elder brothers in the past eight months. He has built a reputation for pragmatism and is seen as likely to continue the king's cautious domestic reforms.

Prince Ahmed bin Abdulaziz, a younger brother of both Salman and Nayef, was named as the new interior minister after spending several decades as deputy interior minister.

The new crown prince will keep the defence portfolio and has been appointed deputy prime minister to King Abdullah, the royal decree said.

Salman, 76, a half-brother of the 89-year-old Abdullah, is likely to continue with cautious social and economic reforms as well as Saudi Arabia's moderate oil pricing policy, analysts said before his appointment. - Reuters