Iran Now Has the Edge in the Fight Over Oil Prices With Saudi Arabia

Suddenly the tables have been turned on Saudi Arabia.

The biggest oil exporter has swapped its traditional role as price dove with regional foe Iran, for years OPEC price hawk. The government in Riyadh is now offering a deal -- including its first output cut in eight years -- to boost prices; Tehran is dragging its feet. At the center of the reversal is their contrasting thresholds for enduring economic pain.

"Both countries are coming from different positions," said Jason Tuvey, Middle East economist at consulting firm Capital Economics. "Iran has been under sanctions until recently, so it’s getting an economic boost as investment returns and oil output rises. Meanwhile, Saudi Arabia is facing steep fiscal cuts."

http://www.bloomberg.com/news/articles/2016-09-26/in-fight-over-oil-prices-with-saudi-arabia-it-s-advantage-iran