NICOSIA, March 2: Economic cooperation between the Middle East and Europe moved forward this week with the Gulf oil monarchies and the European Union (EU) agreeing to speed up the conclusion of a free trade accord.

The EU and the Gulf Cooperation Council (GCC) Tuesday said negotiations would take place in Brussels March 20 and 21 and would be followed by additional contacts at an accelerated pace to reach an agreement on a free trade zone linking the two regional groups.

The joint announcement was made at the end of talks held in the southern Spanish city of Granada between the 15-member EU and the six monarchies making up the GCC.

The two sides did not set a target date for the conclusion of an accord, but GCC officials said they hope it will be signed this year.

The GCC removed a major obstacle to a free trade area with the EU when it decided last December to bring forward, from 2005 to 2003, the creation of a customs union of its members — Saudi Arabia, Kuwait, the United Arab Emirates, Qatar, Bahrain and the Sultanate of Oman.

The EU is the GCC’s principal market and its second supplier after Japan. EU exports to the GCC were last year worth 29 billion euros ($25.2 billion), with imports amounting to 22 billion euros, according to the EU.

Another development related to cooperation with Europe was announced on Wednesday in Amman by Jordan’s Foreign Minister Marwan Moasher, who said all the European Union parliaments have ratified the association agreement with his country.

The ratification opens the door for setting up a free trade zone between Jordan and the EU in 2010.

Good news to the region came also from the international commodities markets, where crude oil was on the rise on the back of rumors of a US attack against Iraq, and a decline in the level of US petroleum inventories.

The price of a barrel of Brent North Sea crude for April delivery rose 38 cents to $21.23 on Thursday in London.

Analysts attributed the drop-off in US inventories to a pact by global producers to rein in supplies from the start of the year.

The Organization of Petroleum Exporting Countries (Opec) orchestrated an output cut of almost two million barrels per day (bpd) by leading world crude producers, and given the time that oil takes to ship around the world, the cutbacks are just starting to be felt in stock levels.

Opec on Wednesday urged non-member oil producers to maintain through the second quarter the output reductions they began January 1 so as to keep the price of a barrel above $20.

Other oil-related developments in the region included a leak at an oil-gathering centre in Kuwait’s Burgan oilfield, cutting its production by 60,000 bpd.

The leak, announced Monday, did not affect the emirate’s total output as its was swiftly compensated from other centres in Burgan, the world’s second- largest oilfield after Ghawar in Saudi Arabia.

On the gas front, Iran and Pakistan have signed a memorandum of understanding in Islamabad to undertake a pre-feasibility study for a proposed 2,600 kilometre (1,600 mile) Iran-India gas pipeline via Pakistan.

Iran holds the world’s second-largest gas reserves after Russia.

The Iranian parliament has also earmarked $25 million to build a railway linking the northeastern city of Torbat-e-Heydarieh with the western Afghan city of Herat.

The line was part of a project designed in 1975 by a French company to link Paris with China through Kabul.—AFP