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Oil prices rise after Saudi Arabia cuts Iran ties

Turkish Prime Minister Ahmet Davutoglu on Tuesday called on Saudi Arabia and Iran to use diplomatic channels to calm tensions following the execution of a prominent Shi’ite cleric, and said Turkey was ready to play a role.

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Relations between Sunni-ruled Saudi Arabia and Shiite-dominated Iran have been strained for decades, with Riyadh frequently accusing Tehran of interfering in Arab affairs.

The kingdom’s severing of ties with Iran on Sunday – after demonstrators stormed its embassy in Tehran in protest at the execution of Nimr – also underlined an assertive new foreign policy to counter Tehran under King Salman’s year-old monarchy.

Turmoil in the Middle East resulting in several Gulf States cutting diplomatic ties with Iran won’t have any effect on New Zealand reaching a free trade deal in the region, according to the Ministry of Foreign Affairs and Trade.

If Rouhani wants diplomatic and economic re-engagement with the outside world, says Ansari, then “Iran has to be very careful not to get a reputation for basically whenever it gets angry at a country of assaulting its embassy”. Saudi Foreign Minister Adel al-Jubeir also told that Riyadh would halt air traffic and commercial relations between the rival powers. Iran plans to raise output by half a million to 1 million barrels per day (bpd) post sanctions, although Iranian officials said they did not plan to flood the market with its crude if there was no demand for it. Iran’s oil exports have fallen to around 1 million bpd, down from a peak pre-sanctions peak of nearly 3 million bpd in 2011.In Russia oil output hit a post-Soviet high in 2015, averaging 10.73 million bpd.

“With so much turmoil in the region, the last thing we need is for people not to be having conversations”. “With increased geopolitical tensions between Saudi Arabia and Iran, the market has put a premium on prices just when markets opened (in 2016)”, brokerage Phillip Futures said on Monday. This led to attacks by Iranian protesters on Riyadh’s embassy in Tehran and consulate in Mashhad.

“Criticism should not be responded to with beheading”, the Iranian President said. “There is nothing the Saudis can do to destabilize Iran whereas the Iranians on the other hand have every means conceivable to destabilize Saudi Arabia and other Gulf countries, namely Bahrain”. The council statement, agreed to after hours of negotiations, made no mention of the Saudi executions or the rupture in Saudi-Iranian relations.

There are ongoing tensions after Saudi Arabia executed influential Shiite cleric Namr el Namr at the weekend, enraging Iran, and Shiite muslims across the middle east and beyond. “Such countries don’t need to open new fronts, while already-opened fronts already exist, meaning Syria will surely be affected by the conflict of such countries”, he said.

Nobahkt also said: “We condemn the inhumane, barbaric and Daesh-like execution of the cleric Sheikh Nimr”, using the Arabic acronym for the Islamic State group.

Shi’ite Iran hailed him as a “martyr” and warned Saudi Arabia’s ruling Al Saud family of “divine revenge”.

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“Enough is enough. Again and again Tehran has thumbed its nose at the West. They continue to sponsor terrorism and launch ballistic missiles and no one is doing anything about it”, said a source familiar with the Saudi government’s thinking who spoke on condition of anonymity.

Rouhani: Saudi Arabia can't 'cover its crime'