Steinmeier, whose country holds the rotating EU presidency until the end of June, said at the start of an annual conference between the two blocs that there was now momentum to wrap up the negotiations which first began in 1990.

"These are tough talks but we are on the right track," he told reporters as the meeting began in Riyadh.

"I have the impression that we are bridging the distance between us. I am optimistic that we will be able to conclude the negotiations this year."

The GCC groups Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the United Arab Emirates.

The European Union aims to harness the boom in the Gulf sparked by rising oil prices to ramp up trade and boost its political and strategic leverage in the Middle East.

The European Commission expects trade volume to double soon after the agreement is signed. But the negotiations have stalled due to a number of factors, Steinmeier said.

"The Gulf Cooperation Council has a different structure than the European Union. (It) does not have integrated policies so every step in the negotiations between has to be approved by all the governments. That makes the talks more difficult."