The annual list selected what Forbes said were the world's 71 most-powerful people from among the roughly 7.1 billion global populace, based on factors ranging from wealth to global influence.
Politics trumps business in 2012's list as various heads of state took up six of the top 10 spots.
Obama was joined in the top 10 by German Chancellor Angela Merkel
and Russian President Vladimir Putin;
Bill Gates ranked four, followed by Pope Benedict XVI
(5) Federal Reserve Chairman Ben Bernanke (6), King Abdullah bin Abdulaziz al Saud of Saudi Arabia (7), European Central Bank President Mario Draghi (8), Secretary-General of China's Communist Party Xi Jinping (9) and British Prime Minister David Cameron,
who ranked 10.
"This year's list reflects the changing of the guard in the world's two most powerful countries: The United States and China," Michael Noer, Forbes' executive editor said.
Noer noted that China's President Hu Jintao, last year's third most-powerful person, fell off the list as he is leaving power, and his successor, Xi Jinping, ranked ninth instead.
Both US Treasury Secretary Timothy Geithner and Secretary of State Hillary Clinton,
who have stated they will not be serving in Obama's second term, were not in this year's rankings.
Forbes based its ranking on four criteria for power and averaged the four grades: Power over many people, control over financial and other valuable resources, power in multiple spheres or arenas and active use of power.
Some measures, such as power over many people, favored leaders such as the Pope, while the world's richest man – Mexican telecom magnate Carlos Slim Hula, worth a reported $72 billion – placed 11th on the strength of his wealth.
Others, such as New York's billionaire Mayor Michael Bloomberg,
scored high in all areas, placing him at No. 16.
Former President Bill Clinton
placed 50th, with editors noting that by hitting the campaign trail for Obama, Clinton "cemented his status as a kingmaker", along with his nonpartisan Global Initiative raising more than $71 billion in commitments to fund charitable action worldwide.
Other high-ranking heads of state included French President Francois Hollande (14)
and Indian PM Manmohan Singh (19).