U.S. seen trying to calm waters between Qatar and Saudi Arabia

The crisis is the worst to hit Gulf Arab nations since the creation in 1981 of the Gulf Cooperation Council (GCC) grouping Saudi Arabia, Bahrain, the UAE, Kuwait, Oman and Qatar.

Qatar hosts the largest U.S. airbase in the region, which is crucial in the fight against Islamic State group jihadists, and is set to host the 2022 football World Cup.

The five countries have since closed off their air, land and sea contact with the peninsula. Qatar is an economic powerhouse in the Gulf and hosts the headquarters of the USA military's Central Command. It said the decisions would "not affect the normal lives of citizens and residents". Adrian J.T. Rankine-Galloway said the US military had "no plans to change our posture in Qatar".

"The relentless increase in US oil production appears to have the market anxious that the OPEC cuts will be completely nullified by the increased USA production", said William O'Loughlin, analyst at Rivkin Securities.

"I think what we're witnessing", Tillerson said, "is a growing list of some irritants in the region that have been there for some time, and obviously they have now bubbled up to a level that countries decided they needed to take action in an effort to have those differences addressed". Deputy Prime Minister Numan Kurtulmus said after a Cabinet meeting that the government hopes Erdogan's initiative will help overcome tensions, although he provided no details. "Crude production in the Middle East will not change because of Qatar", said Oystein Berentsen, managing director for oil trading company Strong Petroleum.

"The aim is clear, and it is to impose guardianship on the state", it said, insisting authorities would "take all measures necessary... to foil attempts to affect or harm Qatar's society and economy". It did not elaborate.

Last month, the Qatari news agency quoted Emir Tamim bin Hamad Al Thani as saying that Iran is "a regional, Islamic power that can not be ignored" and it would not be wise to fight against it. Qatar shares a massive offshore gas field with Iran.

Tensions escalated last week after the official Qatar News Agency ran a report quoting the Emir of Qatar making favourable comments about Iran and criticising U.S. President Donald Trump's hardline policy towards Tehran.

"The continuation of this independent foreign policy means banking on the economic and diplomatic ties Qatar has forged through investment, natural gas export, diplomacy and mediation". The chief worry among them is the Muslim Brotherhood, a Sunni Islamist political group opposed to monarchical rule.

USA officials in multiple agencies stressed their desire to promote a reconciliation between the Saudi-led group and Qatar, a state of 2.5 million people with vast natural gas reserves. Eight months later, they returned their ambassadors as Qatar forced some Brotherhood members to leave the country and quieted others.

"Qatar's Emir first gesture of good will likely be the shutting of Al Jazeera TV network entirely, which could happen in months if not weeks", Sultan Al Qassemi, a prominent regional commentator, said in a tweet.

The UAE accused Qatar of "funding and hosting" the group in its statement announcing the severance of ties.

"Now is a time that we should be more united than ever", said Aamer Hassan, a Canadian living in Qatar.

Associated Press writers Aya Batrawy in Dubai, United Arab Emirates, Robert Burns in Sydney, Maggie Michael in Cairo and Reem Saad in Amman, Jordan, contributed.

  • Zachary Reyes