The head of the Houthi Supreme Political Council, Mahdi al-Mashat, shakes hands with Saudi ambassador to Yemen Mohammed Al-Jaber. AFP

A Saudi delegation has concluded a round of peace talks in the Yemeni capital Sanaa with the Houthi movement, whose officials cited progress and said further discussions were needed to iron out remaining differences.

In a significant confidence-building measure, the conclusion of the talks was followed on Friday by an announcement from the International Committee of the Red Cross that the release and swap of nearly 900 detainees by the two sides in the conflict had started.

Saudi Arabia, which leads a coalition that has been battling the Iranian-aligned group since 2015, is seeking a permanent ceasefire agreement to end its military involvement in the war.

Two Yemeni sources said the Saudi team left Sanaa on Thursday following a visit that signalled movement to build on an expired UN-brokered truce and followed last month's deal between Saudi Arabia and Iran to restore ties.

 Yemeni Houthi prisoners are released during a prisoner exchange with the internationally recognised-government. AFP

Houthi politburo official Mohammed al-Bukhaiti described the negotiations as "going well". Another Houthi official, Abdulmalik Alejri, said on Twitter that "with determination and honest intentions remaining difficulties can be resolved".

Sources have told Reuters that the Saudi-Houthi talks facilitated by Oman were focused on a ceasefire, full reopening of Houthi-controlled ports and Sanaa airport, payment of public sector wages, rebuilding efforts, and the withdrawal of foreign forces from Yemen.

STICKING POINTS

Two Yemeni sources, also speaking on condition of anonymity, said the parties could agree on an extended truce deal as they work out remaining differences.

The main sticking points include payment of civil servant salaries - which the Houthis have insisted include armed forces - using oil revenue and a timeline for foreign forces to exit the country, three sources familiar with the negotiations said.

 Yemeni Houthi rebel prisoners on their way to board a flight to Sanaa. AFP 

The conflict, in which the coalition intervened against the Houthis after they ousted the Saudi-backed government from Sanaa in late 2014, is a multifaceted one with several Yemeni factions vying for influence.

Reuters