Shabtabnews In this dark night, I have lost my way – Arise from a corner, oh you the star of guidance.
Al-Monitor – Beijing hosted this month the first formal meeting of the foreign ministers of Iran and Saudi Arabia in more than seven years. The diplomatic breakthrough is certainly welcome news and opens opportunities in the region. However, this deal rests on many recent unexpected geopolitical developments that have created shifting strategic perceptions and conditions for both Saudi Arabia and Iran to come to this decision.
The sustainability of this agreement is just as uncertain as the future of the conditions that paved the way for it to conclude. There were key drivers and perceptions/assumptions that led to this strategic shift in Tehran and Riyadh: first, the growing uncertainty regarding the US role in the region considering the withdrawal from Afghanistan and the strategic pivot toward Asia that has shaped a strong perception that the US role in the region is on decline; second, Russia’s war in Ukraine and the perceptions that regardless of the results of the war, Russia’s challenging of the international order could lead to major strategic shifts; third, the future of Iran’s nuclear program with no prospects for an agreement in the short run, mainly due to Iran’s brutal repression of protests in the wake of Mahsa Amini’s death in Iranian police custody and Tehran’s support for Russia’s war in Ukraine; and last, but not least, the political unrest itself across Iran.
The combination of these factors have led Saudi Arabia and Iran to rethink and adjust their strategies for engagement with each other, as well as other actors — the United States, Russia and China. Reports by the International Atomic Energy Agency about Iran’s uranium enrichment nearing 84% adds further complication as Iran nears a US red zone. With very few alternative options for diplomatic resolution, the region is headed down a dangerous path as the potential for military escalation grows. Uncertainty in the region increases the risk of conflict and both Saudi Arabia and Iran have a vested interest in lowering the temperature.
The US-Gulf dynamic
The United States has stated and reassured partners that the pivot to Asia does not mean that it will leave the region. Washington has highlighted the scale and number of capabilities it will keep in the region to maintain its security commitments. However, there remain strong perceptions of a waning US presence and influence in the region. Perceptions can be more powerful than reality as they shape policy decisions, which can then impact the realities by creating new dynamics.
The Riyadh-Washington relationship has been under increased strain. Saudi leaders have grown concerned about a weakening security partnership as the United States scaled back its support for the wars in Yemen and Syria. From the Saudi perspective, the tepid American response to the Iranian attacks on Saudi oil facilities emboldened perceptions among Saudis and Emiratis that the United States would not compromise on its own interests in order to protect vital interests of their regional partners. The failure of the Trump administration’s maximum pressure campaign against Tehran to produce any change for the better from the Saudi perspective also fueled perceptions within the kingdom that Washington may not be able to settle the nuclear issue with Iran. These dynamics have left Riyadh feeling less secure and with a need to diversify its strategic partnership to pursue its own national interests, even if it affects their relations with the United States. Through expansion of its partnerships with China and Russia, and favoring its own economic independence, Riyadh has indicated it will not be beholden to US interests.
From the Saudi perspective, a past escalatory cycle caused the oil facility attacks, which demonstrated Iran could inflict significant costs despite its isolation and limited conventional military capabilities. As current conditions point to the start of another potential escalatory cycle, Riyadh is painfully aware of the need for de-escalation. A senior Saudi official acknowledged a need to shift “from hostile relations to better relations,” particularly with the threat of a nuclear Iran. Within Saudi Arabia, the deal was also positioned as a step toward fulfilling the Vision 2030 development plan and as having fulfilled “Saudi demands for respect for state sovereignty and non-interference.”
Iranian leaders view the war in Ukraine and an ascending China as a direct challenge to US power and an opportunity to create a regional multipolarity. Tehran has thrown its support behind Moscow, deepening military and economic ties through the provision of drones and a growing investment and trade portfolio. The Iranian political elite see the value in capitalizing on the great power strategic competition to contribute to a transition from the US-led liberal international order toward a multipolar system no longer dominated by the United States.
For Iran, the absence of sanctions relief and potential military conflict has strengthened its incentive to work with partners in the region to de-escalate tensions, which it has done with Saudi Arabia, the United Arab Emirates and Iraq. There are major economic incentives that come with regional rapprochement for both sides. Normalization of relations would translate into lower risks, but also greater trade and investment opportunities. Potential Saudi investment in Iran holds an estimated value of up to $20 billion, according to Crown Prince Mohammed bin Salman. While there is still the challenge of US sanctions, investment and cooperation could begin in non-sanctioned industries, in emerging industries — such as transit and mining — and in the energy sector.
The draw of regional rapprochement
This agreement, however, was also successful because Saudi Arabia and Iran were able to offer mutual, worthwhile security and economic incentives. The breakthrough in Beijing came after several rounds of talks that began in April 2021. What tilted the scale to conclude the many rounds of negotiations was the card that the Saudis possessed beyond the economy and the United States: their media influence on political unrest in Iran.
Through five rounds of talks, the cease-fire in Yemen remained a centerpiece, but the demands and offerings never aligned well enough to close that deal. Yet, as protests erupted across Iran in the fall of 2022, the Islamic Republic faced their greatest challenge since the 1979 revolution. The Iranian regime has brushed off the unrest as Western plots aimed for regime change, but Tehran also accused several media outlets of stoking unrest and waging a “media war,” including the Saudi-affiliated Iran International that provided 24-hour coverage of the protests. The terms of the rapprochement included a commitment from Saudi Arabia to reportedly stop funding Iran International — a very valuable concession for Tehran in the face of ongoing unrest. In turn, Iran agreed to curb its support of Houthi rebels in Yemen, a long-desired outcome of these talks from the Saudi perspective.
China’s role as the broker signifies a transition to regional multipolarity. Riyadh and Tehran have welcomed Beijing as a new strategic partner in anticipation of a declining US role in the region. Over nearly two decades, Tehran and Beijing have forged deeper economic and political ties, including a 25-year strategic cooperation agreement signed in March 2021 and Iran’s accession to the Shanghai Cooperation Organization in September 2022. Saudi Arabia, Iran and others in the region are embracing the concept of “omni-alignment” — the practice of maintaining relations with multiple great powers, rather than choosing one or none. Omni-alignment is an especially important hedging tool in a scenario where American and Chinese engagement is “unclear” and “increasingly unsettled.
The interaction of other great powers in the region allows states there to diversify strategic partnerships and mitigate the security risk of over-reliance on any one great power partner. Recent geopolitical developments have created a reordering of the regional strategic environment with more opportunity for China and Russia to expand their influence and reach in the Middle East. We should be cautious in interpreting the success of the agreement as Saudi Arabia, Iran and others will continue to hedge their bets between the East and the West in a dynamically fluid environment. Where Saudi-Iran alignment settles-out in the long run will be based on the evolution of the factors that led to the agreement in the first place: Iran’s nuclear program and political unrest, future of Russia’s war in Ukraine, US-China relations and whether these lead to a new world order.
Mahsa Rouhi is a Research Fellow at the Institute for National Strategic Studies, National Defense University. The analysis and conclusions presented here are based upon individual research and do not necessarily represent the policies or perspectives of National Defense University, the Department of Defense, or the U.S. government.
