Saudi Arabia set to establish joint trade council with Iraq
Saudi Arabia and Iraq are to launch a joint trade commission, the Saudi cabinet announced on Aug. 14, in a sign of a thaw in ties between the two neighbors.
“The cabinet has decided to approve the establishment of the Saudi-Iraqi Coordinating Commission and to delegate the Saudi minister of trade and investments to sign on behalf of the kingdom,” read a statement carried by state-run SPA news agency.
The two countries went a quarter century without diplomatic relations, which were cut following Saddam Hussein’s 1990 invasion of Kuwait after which Saudi Arabia served as the launch-pad for a U.S.-led coalition to oust Iraqi forces.
Saudi Arabia and Iraq, OPEC’s top two producers, were both dealt a serious blow when oil prices plummeted following a global production glut in 2014.
Riyadh and Baghdad showed an improvement in ties in June, when Iraqi Prime Minister Haider al-Abadi visited the kingdom followed by a series of visits by high-ranking officials.
Iraq’s Energy Minister Jabbar al-Luaybi and his Saudi counterpart Khalid al-Falih last week jointly announced they would strengthen their commitment to pledged oil production cuts and vowed to ensure coordination of their nations’ oil policies.
OPEC and non-OPEC members have pledged to cut back on production in an effort to stabilize market prices.
While Saudi Arabia met its production limits in July, Iraq only made one-third of the cut it had pledged, according to a report published by the International Energy Agency.
Influential Iraqi Shiite cleric Moqtada al-Sadr, who led a militia that fought against the U.S. occupation of Iraq, last month made a rare trip to Saudi Arabia, a key regional ally of Washington.
The rekindling of ties comes at a time of diplomatic crisis in the Gulf after Saudi Arabia cut all ties with neighboring Qatar.