An escalating dispute over a gas field in the Gulf poses an early challenge to a Chinese-brokered agreement to reconcile regional rivals Saudi Arabia and Iran.

Saudi Arabia and neighboring Kuwait jointly claim the offshore Al-Durra gas field. Iran says it has rights to the field, which it refers to as Arash. The two sides held talks in Iran in March but were unable to agree on a border demarcation.

A spokesman for Iran’s Foreign Ministry, Nasser Kanaani, said the country would not tolerate any infringement on its rights, echoing remarks by the country’s oil minister the previous day.

“We have expressed our readiness to engage in dialogue with the Kuwaiti side,” Kanaani told reporters Monday. “But if there is no interest in mutual utilization of this joint field, the Islamic Republic of Iran has naturally put the exploration and utilization of the resources on its agenda.”

Kuwait’s oil minister told Sky News Arabia last week that his country would commence drilling and production without waiting for a deal.

Saudi Arabia has sided with Kuwait, saying the two countries have exclusive ownership of the field, and has called on Iran to return to negotiations.

Saudi Arabia and Iran, which have backed opposite sides in conflicts across the Middle East and accused each other of destabilizing the region, formally restored diplomatic relations in April following a seven-year freeze. They have since reopened embassies and welcomed senior officials on visits.

But they continue to back opposite sides in Yemen’s civil war, which is ongoing despite a 15-month cease-fire. Saudi Arabia is also in negotiations with the United States over potentially normalizing relations with Israel, which Iran’s leaders have said should be wiped off the map.

“Any step in the direction toward normalization of ties with this aggressive regime will only serve to give it more leeway to commit more atrocities against the Palestinian nation,” Kanaani, the Iranian Foreign Ministry spokesman, said.

It’s unclear whether the dispute over the gas field, which goes back to the 1960s, will escalate beyond rhetoric. But tensions are already high in the Gulf, where the U.S. is building up military forces in response to what it says is Iran’s unlawful seizure of oil tankers and harassment of commercial vessels.

Saudi Arabia and Kuwait agreed last year to jointly develop the gas field. Kuwait said at the time that they aimed to produce 1 billion cubic feet of natural gas and 84,000 barrels of liquefied gas per day. Iran denounced the agreement as illegal and said it should be included in any such plans.

Source. Associated Press