Baghdad , Iraq ( CNN ) -- Both Iraq and Iran stood their ground Saturday over the reported seizure of a southern Iraqi oil well by Iranian forces . Two days after Iraq said an Iranian `` armed group '' crossed the border into Iraq and seized the well , Iraqi Deputy Foreign Minister Labid Abawi said the occupation of well No . 4 in Maysan province 's Fakka oil field continues . But in a statement issued by its embassy in Iraq , Iran denied what it characterized as rumors of its forces crossing the border , and hinted that the claim was political because it comes ahead of next year 's Iraqi parliamentary elections . Both sides said they are in negotiations and have a joint committee dedicated to handling border disputes diplomatically . On Friday , the Iraqi government issued a strong statement deploring the alleged seizure , after Iraqi Prime Minister Nuri al-Maliki headed an emergency meeting of Iraq 's National Security Council to discuss the situation . Iraq and Iran share a long border , and high-ranking committees from both countries handle all border matters , an Iranian Embassy official said . Iraq and Iran fought a bloody eight-year war that ended in 1988 in a cease-fire with no clear victor and parts of the border under dispute . Ties between Iran and Iraq -- both predominantly Shiite Muslim nations -- greatly improved after the overthrow of the Saddam Hussein regime in 2003 . At the same time , there has been widespread concern among Iraqi and U.S. officials that Iran has been providing Iraqi insurgents with material for roadside bombs during the Iraq war . Drilled in 1979 , the well is in Iraq 's Maysan province , east of Amara , near the Iranian border . It is within the province 's Fakka oil field , the Iraqi government said . The report of the oil well incident comes several days after the Oil Ministry 's two-day auction of oil fields . Aimed at increasing Iraqi oil production , deals were struck for seven of the 15 fields offered . There also had been oil bidding in June . CNN 's Mohammed Tawfeeq and Yousif Bassil contributed to this report .
NEW : Both sides say they are in negotiations , have committee working on border dispute . Well is in Maysan province , east of Amara , near Iranian border , officials say . The two countries fought 8-year war that ended in 1988 with parts of border under dispute .