Saudi Arabia Iran Agreement

Last week, China brokered an agreement between two major powers in West Asia, Saudi Arabia and Iran, to restore diplomatic relations. The rivalry between the two countries has existed for decades, with sectarian and ideological factors adding to the mix after the Iranian revolution in 1979. The conflict had turned into a cold war, with both sides supporting their proxies in the region, and formal ties collapsed in 2016 after the Saudi embassy in Tehran was overrun by protesters. The recent agreement, if it holds, could have significant implications for regional security and geopolitics.

            The two countries started direct talks in 2021 and held several rounds of negotiations in Iraq and Oman without success. However, both sides agreed to keep the diplomatic path open. In December 2021, Chinese President Xi Jinping encouraged a rapprochement between the two countries during his visit to Riyadh. Saudi Foreign Minister Prince Faisal bin Farhan also mentioned in January in Switzerland that they were reaching out to Iran and trying to find a path to dialogue, without mentioning China’s involvement. Last week, after secret talks in Beijing, the reconciliation was announced.

            The finer details of the Saudi Arabia-Iran reconciliation agreement are yet to be disclosed. However, reports suggest that Iran has agreed to prevent further attacks against Saudi Arabia, particularly from the Houthi-controlled parts of Yemen. In return, Saudi Arabia has agreed to rein in Iran International, a Farsi news channel critical of the Iranian regime. The two countries plan to reopen embassies in each other’s capitals in two months, after their Foreign Ministers thrash out the terms of the reconciliation. China is also planning to host a cross-Gulf conference of Iran and the six Gulf monarchies this year to further strengthen peace in the region.

            Saudi Arabia’s decision to reach out to Iran comes amidst strategic realignments in West Asia. In 2020, the UAE became the first Arab country to normalise relations with Israel after a 25-year gap. Following this, Israel and Arab countries deepened their partnerships. In 2021, Saudi Arabia, the UAE and their allies lifted their blockade of Qatar. Meanwhile, the U.S. was trying to broker a normalisation agreement between Saudi Arabia and Israel. These realignments are a result of the U.S.’s de-prioritisation of West Asia, as it faces bigger foreign policy challenges such as the Russian war in Ukraine and China’s rise in the Indo-Pacific. America’s allies in the region see the power vacuum created by the U.S.’s de-prioritisation and the challenge posed by Iran’s rise. To address these problems, the U.S. aimed to bring Israel and the Arab world together against Iran. While the UAE chose this path through the Abraham Accords, the Saudis decided to go slow on reconciling with Israel, especially due to the violence in Israeli-occupied Palestinian territories.

            The recent reconciliation between Saudi Arabia and Iran has garnered attention worldwide. Iran’s decision to accept the deal may have been motivated by its economic struggles and desire for Chinese investment and support for its currency, as well as the strategic advantage of complicating US efforts to rally Arab countries and Israel against it. Meanwhile, China, as a major buyer of Saudi oil and largest trading partner of Iran, has gained economic, regional, and strategic benefits from playing the role of a peace broker in West Asia. The US has publicly welcomed the reconciliation as a positive development, but it may face challenges in maintaining its influence in the region, particularly with Saudi Arabia drifting further away and Iran making new friends, all while China deepens its presence in a region previously dominated by the US. However, the success of the reconciliation remains uncertain, given the complex and multi-layered Saudi-Iran rivalry and the potential for renewed conflicts.