KUWAIT CITY (AFP) - Kuwait was plunged into a new crisis on Tuesday after the cabinet in the oil-rich Gulf state resigned over a standoff with parliament, a move that may trigger early elections. "The prime minister submitted his resignation and that of all cabinet ministers to the emir," said the minister for royal court, Sheikh Nasser Sabah al-Ahmad al-Sabah. "The emir has deferred a decision on the resignation until another time," he said according to the official KUNA news agency, adding that the emir has asked cabinet to continue carrying out its duties. Kuwaiti ministers " led by Prime Minister Sheikh Nasser Mohammed al-Ahmad al-Sabah " had walked out of parliament earlier on Tuesday as the 50-seat house was due to set a date to question the premier. The move raised the prospect of parliament being dissolved for the third time in as many years. But parliament speaker Jassem al-Khorafi said after a meeting with Emir Sheikh Sabah al-Ahmad al-Sabah: "I can confirm that parliament will not be dissolved." The government, which decided on its resignation at an emergency meeting following the walkout, said in its resignation letter that it was unable to work with parliament, which was elected only in May. Under Kuwaiti law, if the emir accepts the resignation he can either form a new cabinet or dissolve parliament and call for fresh elections. Several MPs had said they expected the emir to issue a decree on Tuesday to dissolve parliament, with some expecting both the constitution and parliament to be suspended, which means no fresh election will be called. Three MPs last week called for Sheikh Nasser to be grilled, accusing the nephew of the emir of allowing a prominent Iranian Shiite cleric to enter Kuwait despite a legal ban. They have also accused him of failing to "perform his constitutional duties... and that it was time that Kuwait had a premier capable of running the state and achieving the wishes of the people." And they have alleged that corruption and squandering of public funds had rapidly increased under the leadership of Sheikh Nasser. Despite the latest political crisis, the Kuwait stock market, which has been battered over falling oil prices and the global financial crisis, closed up 0.45 percent. The OPEC member state is no stranger to such crises, with many MPs blaming disputes in the ruling Al-Sabah family. Kuwait's constitution, the first adopted by an Arab state in the Gulf, was suspended in 1976 for five years and in 1986 for six years when parliament was also dissolved. In 2006, a power struggle among the Al-Sabahs resulted in an unprecedented vote by the elected parliament to remove the then emir, Sheikh Saad Abdullah al-Sabah, on health grounds. Parliament was dissolved in May 2006 following a dispute between the government and MPs over election reforms. Parliament was again dissolved in March 2008 over political disputes between MPs and the government, and fresh elections were held in May. Since his appointment to the post in February 2006, the Kuwaiti premier, 68, has formed four cabinets and made two key reshuffles over disputes with parliament. The Al-Sabah family has run the affairs of Kuwait since it came into existence some 250 years ago, and Kuwaitis have seldom questioned their continuing rule. The emir, crown prince and the prime minister are all from the family, which also controls the key ministerial porfolios of defence, interior, information and foreign affairs. Kuwait is the fourth largest OPEC producer with a daily output of 2.4 million barrels. It has a native population of just over one million people, besides 2.35 million foreign residents.