"We have no choice but dialogue," Saleh said at a meeting of his General People's Congress party in the capital Sanaa yesterday.
"We are ready to go to Riyadh, Khamis Mushit, Muscat or elsewhere to start dialogue and to reach an understanding," Saleh said, referring to cities in Saudi Arabia and neighbouring Oman.
Saleh however reiterated his rejection of the government of internationally recognised President Abedrabbo Mansour Hadi and said Saudi Arabia would have to find "new leadership".
The Yemeni leader also said he hoped to "form an alliance with Iran that would serve the interests of Yemen".
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Shiite-dominated Iran is a key supporter of Yemen's Huthi rebels and the main regional rival of Sunni-ruled Saudi Arabia.
Saleh, who survived an assassination attempt in 2011, has repeatedly said he was open to talks with Saudi Arabia.
But he ruled out mediation by UN special envoy Ismail Ould Sheikh Ahmed, who aims to resume stalled peace talks by the end of May, accusing him of bias.
Saleh yesterday said 11,000 rebels had been killed and more than 25,000 injured in the past two years.
While Saleh resigned under massive popular pressure in February 2012, he remains highly influential in Yemen. He was succeeded by Hadi, previously his vice-president.
Parts of the army remained loyal to Saleh after his resignation and he solidified his position as a crucial player in 2014 when he forged an alliance with the Huthi rebels.
The Hadi government is based in Aden, Yemen's second largest city. The president himself mainly resides in Saudi Arabia.