Saudi Arabia’s oil minister calls for further economic cooperation with Iraq

BAGHDAD — Saudi Arabia’s Oil Minister Khalid Al Falih made a high profile visit to Iraq on Saturday, calling for increased economic cooperation and praising existing coordination to boost crude oil prices.

In a speech at the opening of the Baghdad International Exhibition, Falih said cooperation between Iraq and Saudi Arabia contributed to “the improvement and stability we are seeing in the oil market”.

Falih is the first Saudi official to make a public speech in Baghdad for decades. The two countries began taking steps towards detente in 2015 after 25 years of troubled relations starting with the Iraqi invasion of Kuwait in 1990.

Tension remained high after the 2003 US-led invasion of Iraq, which toppled Saddam Hussein. The American occupation of Iraq empowered political parties representing Iraq’s Shiite majority, close to Saudi Arabia’s regional rival Iran.

Iraq is seeking economic benefits from the thaw with Riyadh while Saudi Arabia hopes closer ties would help rollback Iran’s influence in the region. 

“The best example of the importance of cooperation between our two countries is the improvement and stability trend seen in the oil market,” said Falih, to applause from the audience of Iraqi ministers, senior officials and businessmen.

Falih and Saudi Foreign Minister Adel Al-Jubeir held talks earlier this year in Baghdad, paving the way for visits to Saudi Arabia by Iraqi Prime Minister Haider Al Abadi and popular Shiite cleric Moqtada Al Sadr. 

Saudi Arabia and Iraq are respectively the biggest and second biggest producers of the Organisation of the Petroleum Exporting Countries (OPEC).

The Iraqi oil ministry said Falih and his Iraqi counterpart, Jabar Al Luaibi, agreed to cooperate in implementing decisions by oil exporting countries to curb global supply in order to lift crude prices.

OPEC, Russia and several other producers have reduced production by about 1.8 million barrels per day  since the start of 2017, helping to boost oil prices. The cutbacks should continue until March 2018.

“The market has improved a lot but has still some way to go,” Falih told reporters, adding that the compliance of the 24 nations taking part in the cutbacks deal “exceeds 100 per cent”.

Falih called for increased economic cooperation between the two countries at all levels, saying Saudi Arabia is implementing measures to facilitate the flow of goods and services between the two countries.

A Saudi commercial airplane, operated by Flynas, arrived in Baghdad on Wednesday for the first time in 27 years.

In August, the two countries said they planned to open the Arar land border crossing for trade for the first time since 1990.