Sadeq Mahsouli, who like Ahmadinejad hails from the Revolutionary Guards, faces a parliamentary vote of confidence in a process that is being watched closely by international oil firms keen to do business with Opec's second biggest exporter.
A political tug of war over Iran's most prestigious cabinet job has exposed deep rifts in the ruling conservative camp.
Ahmadinejad's first choice was unexpectedly rejected by lawmakers in August, and by naming Mahsouli the president has ditched the second choice candidate he originally proposed to parliament's energy commission.
The appointment of oil minister has traditionally gone very smoothly since the 1979 Islamic revolution.
Political analysts say this is because it has been clear to parliamentarians that the president's nominee had the approval of Iran's all-powerful Supreme Leader.
Mahsouli has no oil industry experience, according to a biography issued to the official IRNA news agency. Like Ahmadinejad he hails from the Revolutionary Guards. He was governor of the western city of Orumiyeh and his highest office was a minor deputy defence minister.
Ahmadinejad's first nominee for oil minister, Ali Saeedlou, was rejected for having too little knowledge of the hydrocarbons sector.