Iran says 'misunderstanding' caused oil well incident

Tehran: Iran on Tuesday described a border incident with Iraq, which caused oil prices to rise late last week, as a "misunderstanding" and called for experts from both countries to look into border demarcation issues.

The statement came two days after Iraqi officials said Iranian troops had withdrawn partially from a disputed oil area claimed by both Tehran and Baghdad, possibly defusing a border feud straining the two neighbours' ties.

"Our stance has been crystal clear ... it was a misunderstanding," Iranian Foreign Ministry spokesman Ramin Mehmanparast told a news conference in comments translated by English-language state television.

Saying the two countries' foreign ministers had reached an "understanding" in a phone conversation on Saturday, he added a committee should be formed to look into border demarcation issues between Iran and Iraq, which fought a 1980-88 war.

"We think it is a technical and expert issue and the experts of both sides should sit down and look into ... specifying the border areas between the two countries so that such misunderstandings are removed," he said.

On Sunday, Iraq's government spokesman said a group of Iranian troops who had taken over an oil well in a remote region along the Iran-Iraq border last week were no longer in control of the well, which Iraq considers part of its Al Fakkah oilfield.

A border official in Iran was quoted on the same day as saying Iranian forces had returned to their original position after dismantling a barricade built by Iraqi soldiers near the disputed oil well.

Global oil prices climbed on Friday following initial media reports that Iranian troops had commandeered an Iraqi oil well.

Iran and Iraq have a long history of border feuds, including one that escalated into the eight-year war in the 1980s.

The relationship warmed after Sunni Arab Saddam Hussain's ousting in 2003, when Shiites took over in Baghdad and trade and religious tourism picked up.