Introduction
On January 3, 2016, Saudi Arabia’s then-Minister of Foreign Affairs Adel al-Jubeir announced[1] the severing of diplomatic ties with Iran, following attacks on the Saudi Embassy in Tehran during Iranian protests over the execution[2] of Saudi Shia cleric Nimr al-Nimr the day before. The Saudi move was another example of severe tensions between Riyadh and Tehran as several Middle East areas already witnessed proxy wars between the two regional powers.
In March 2023, the two countries reached a Chinese-sponsored reconciliation[3], which was followed by the reopening of embassies and the exchange of ambassadors. The Beijing-brokered deal also stipulated the reactivation of the 2001 bilateral security agreement. The current reconciliation is part of a relationship that has gone through ups and downs since the 1979 Iranian Revolution. Over the past eighteen months, Saudi Arabia and Iran have shown a willingness to ease disagreements and restore a sense of normalcy to their relations. For instance, last month the government of late President Ebrahim Raisi introduced a neighborhood policy[4] aimed at improving relations with neighboring Arab countries, especially Saudi Arabia. But longstanding tension and mutual apprehension remain. The war in Gaza has underscored the divergence in Iran’s and Saudi Arabia’s positions on regional conflicts and each country’s perception of its national security. Iran finds in the Saudi alliance with the United States a political and security threat, while Saudi Arabia views Iran’s regional alliances, its regional role, and its nuclear program as a major danger.
Motives for Reconciliation
The most important factor driving Iran’s pursuit of reconciliation with the kingdom was the Islamic Republic’s difficult economic situation, made worse by American sanctions and regional conflicts. Iran hoped that reconciliation could attract Saudi investment and help build an economic relationship like the one Iran has with the UAE. Additionally, Iran wanted to weaken the influence of the Iranian opposition media in exile, which it accuses[5] Saudi Arabia of financing. The exile media’s influence in stoking anger against the Iranian regime became clear in the wave of protests over the September 2022 death[6] of women,s right activist Mahsa Amini following her detention by the Iranian “morality police.” Iran also reportedly asked Saudi Arabia during reconciliation negotiations to stop funding the Iran International channel.
Another factor was Iran’s desire to avoid being isolated by a potential US-sponsored Arab-Israeli alliance, the groundwork of which has been laid by the so-called Abraham Accords. Iran believed that a return of relations with Saudi Arabia could facilitate better relations with other Arab countries and, most important, could constitute an important step in Tehran’s strategy[7] to drive the United States from the region. During the negotiations, Tehran presented an initiative to establish collective security[8] and regional stability based on cooperation between the countries of the region without foreign interference. In sum, Tehran believed that Saudi reconciliation could neutralize the Kingdom’s role in the US-Iran conflict and dissuade the Gulf Arab states from forging a security alliance with Israel.
As for Saudi Arabia’s motives, reducing security tensions with Iran topped the list after the kingdom perceived that the Trump administration’s “maximum pressure” campaign to limit Iran’s regional role had failed. A turning point in the Saudi conflict with Iran was the September 2019 attack on the Kingdom’s oil facilities[9] in Abqaiq and Khurais, purportedly by Yemen’s Iran-backed Houthis, and the US failure to come to Saudi Arabia’s defense. The Houthis’ 2022 drone and missile attack on Aramco oil facilities[10] in Jeddah, two days before the start of Formula1 race in the coastal city, gave another clear signal to Saudi Arabia that the Yemen war could jeopardize its Vision 2030 plans to diversify the Kingdom’s economy away from oil. The Saudis hoped that reconciling with Iran would lead Tehran to influence[11] the Houthis to stop their attacks on the kingdom.
In general, Saudi Arabia sought to cool the conflict with Iran by reaching a formula of understanding on regional issues that limits what Riyadh considers an Iranian threat in its Arab surroundings from armed groups loyal to Tehran. For Saudi Arabia, economic cooperation with Iran can serve as a good platform to reduce the Iranian threat.
Impact of the Gaza War
The two countries’ ambassadors[12] arrived at their respective embassies in Riyadh and Tehran in September 2023. One month later, Hamas launched Operation “Al-Aqsa Flood” and the region entered a new phase of conflict. The first phone call[13] between President Raisi and Saudi Crown Prince Mohammed bin Salman (MBS) took place on October 11, followed by several meetings between their foreign ministers. In November, Raisi attended the extraordinary Arab-Islamic Summit held in Riyadh. Although Iranian proposal to boycott Israel was not adopted, the outcomes of the meeting conveyed an Iranian-Saudi consensus on the importance of reaching a ceasefire, and Raisi and MBS met[14] on the sidelines.
Although Iran backed its regional allies who joined the Gaza conflict in support of Hamas, it feared the conflict's expansion, a worry shared by Saudi Arabia. Iran therefore tried to convince its allies to reduce their anti-US operations[15] (such as in Iraq) in order not to provoke Washington. Here, Iran's interests aligned with Saudi Arabia's desire to contain the conflict.
Yet in other respects Iranian and Saudi positions toward Gaza and the regional conflict environment diverge. This was demonstrated by Saudi Arabia’s interception[16] of missiles launched by the Houthis toward Eilat and its opposition[17] to the Houthis’ targeting of ships heading to Eilat in Bab al-Mandeb. Saudi Arabia’s concern for the security of the Red Sea, which is vital to the tourism projects that the kingdom is developing on its coast, motivated its actions. For its part, Iran denies involvement[18] in helping the Houthis carry out their attacks in the Red Sea but supports the rebel group’s actions against Israel and the ships heading to Eilat.
The clearest difference between the two countries emerged on April 14, when Iran launched[19] a major missile and drone attack on Israel in response to Israel’s April 13 assassination of top Islamic Revolutionary Guard Corps (IRGC) leaders in a raid on the Iranian consulate in Damascus. Tehran felt compelled to retaliate as it considered targeting the consulate a clear violation of Iranian sovereignty. Although Iran did not want to engage in a direct confrontation with Israel and the United States, it aimed to restore its deterrence with Israel. According to Western media reports[20], Saudi Arabia cooperated in intercepting the Iranian attack by exchanging intelligence information with Israel, but Riyadh denied[21] involvement. Soon after Tehran’s attack, a Saudi analyst published an article[22] in the Saudi newspaper Arab News suggesting that in an era of direct confrontation between Tehran and Tel Aviv, the kingdom would increase its role in the US-led defensive alliance against Iran, despite criticism of Israel’s actions.
The April 14 attack on Israel underscored that the strategic positions of Iran and Saudi Arabia have not changed after reconciliation. Restoring diplomatic ties, however, did allow Saudi Arabia and Iran to avoid a direct confrontation due to disagreements over the Gaza war, including over post-war arrangements for the Strip. Iran wants to preclude the destruction of Hamas’s power or the toppling of its rule in Gaza, while Saudi Arabia has called for the deployment of international forces[23] there and for assisting the Palestinian Authority to take control over the enclave. Additionally, Saudi Arabia adheres to the two-state solution, which Iran rejects. The Gaza war does not seem to have changed Saudi Arabia’s willingness to normalize[24] relations with Israel if the latter accepts a clear path to a two-state solution, while Iran views Riyadh’s normalization with Israel as a serious threat.
The Limits and Future of Reconciliation
While reconciliation has enabled communication amid the recent regional instability, the Gaza war also has revealed the extent of the regional differences between the two parties. Iran's efforts to strengthen its militias across the region and Saudi Arabia's efforts to enter into a defense agreement[25] with the United States as part of an Israel normalization deal confirm that reconciliation has limits. In short, reconciliation has reduced tension between the countries, but has not ended their regional competition or change their threat perception.
Saudi Arabia realizes that Iran will continue supporting its regional allies to ensure its security, protect its interests, and retain its regional role. This makes Saudi Arabia more inclined toward concluding a defense pact with the United States to counterbalance Tehran. Conversely, Iran has become more aware of the challenge in isolating Saudi Arabia from the American regional alliance. Even if Saudi Arabia occasionally diverges in policies with the United States, the strategic security and defense partnership between all the Gulf Arab states and the United States appears steadfast.
So far, reconciliation has not resulted in resolving the regional issues that concern Riyadh, most notably Yemen. One of Saudi Arabia's aims for reconciliation was to facilitate a solution in Yemen, but the Gaza war has delayed such an agreement. Tehran's role is limited to facilitating a solution, as it does not fully control the decisions of the Houthi movement. Similarly, one of Tehran's primary goals for reconciliation—economic cooperation with Saudi Arabia and attracting Saudi investments—has not been realized, as American sanctions remain a significant obstacle. Even resuming diplomatic ties has not led to activating previous agreements or enabling the movement of citizens between the two countries, and no direct flights[26] have been initiated, although Saudi Arabia facilitated[27] Iranian pilgrims’ entering the country for Hajj and Umra.
Additionally, a dispute persists between Saudi Arabia and Kuwait on one side, and Iran on the other, over the ownership of the Durra natural gas field[28] in Gulf waters. Saudi Arabia also continues to have concerns about the Iranian nuclear program, with the Saudis announcing[29] their intent to pursue a nuclear weapon if Iran possesses one.
Conclusion
The necessary resolution of difficult issues between Iran and Saudi Arabia does not depend solely on the two parties. For instance, ending the Yemen war mainly requires actions by internal Yemeni factors[30], and economic cooperation between Riyadh and Tehran is influenced by outside factors such as American sanctions.
Reconciliation has led to calm in certain tense regional arenas but has not significantly deepened bilateral relations or addressed the security concerns of either party. Establishing cooperation in specific areas, such as in Iran’s commercial sector, which is not targeted by American sanctions, could bolster ties. Above all, Iran-Saudi relations will be shaped by regional developments after the Gaza war, especially in Yemen following Houthis threats[31] and if a Saudi-Israeli normalization deal is agreed. The American factor is also decisive, making the results of the US presidential election in November a crucial factor in the direction of ties.
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