The Organization of Petroleum Exporting Countries (OPEC) has turned into the newest battlefield in the intensifying cold war between Iran and Saudi Arabia, the largest producers of the 12-member cartel. Long-standing differences between Riyadh that has constantly supported production levels which keep price rises in check and Tehran, a price hawk, came to head during an OPEC gathering this week. The meeting was the first in ten years that ended without an agreement amongst the cartel’s members.
The rivalry between the two, which has escalated amid mass pro-democratic demonstrations sweeping the Arab World, has now become an international concern. The fragile world economy requires increased oil supplies to stimulate recovery, but is not in a position to afford rising prices.