Iran now has the edge in the fight over oil prices with Saudi Arabia - BBG

Bloomberg carried a story on Tuesday, reporting on the tensions between Saudi Arabia and Iran, and how it may affect the oil output decision in wake of the ongoing oil meeting in Algeria.

Key Headlines:

Saudi Arabia is now offering a deal -- including its first output cut in eight years -- to boost prices

Iran is dragging its feet

The contrast between the two countries is stark. Iran, never as dependent on oil revenue as its neighbor, has seen prospects boosted by rapprochement with the west.

In Saudi Arabia, tentative moves toward economic reform haven’t prevented two years of weak prices causing financial havoc: it’s burning through foreign exchange reserves, government contractors have gone unpaid and civil servants will get no bonus this year.

Jason Tuvey, Middle East economist at consulting firm Capital Economics noted, "Both countries are coming from different positions. 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."