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Jerusalem Center for Public Affairs
Strategic Alliances for a Secure, Connected, and Prosperous Region

Saudi-Iran Rapprochement and Saudi-Israel Normalization: No Contradiction Intended

Filed under: Iran, Israel, Saudi Arabia, The Middle East
Publication: Jerusalem Viewpoints

Saudi-Iran Rapprochement and Saudi-Israel Normalization: No Contradiction Intended
Top Chinese diplomat Wang Yi (center) attends a meeting with Secretary of Iran’s Supreme National Security Council Ali Shamkhani (right) and Minister of State and national security adviser of Saudi Arabia Musaad bin Mohammed Al Aiban (left) in Beijing on March 10, 2023. (China Daily)

Institute for Contemporary Affairs

Founded jointly with the Wechsler Family Foundation

Read this article in Arabic

No. 662, May 2023

  • Saudi Arabia’s return to “diplomatic relations” with the Iranian regime neither contradicts its commitment to alliances intended to prevent the ayatollahs from attaining nuclear weapons nor does it jettison a process of normalization with Israel.
  • There is an argument to be made that Riyadh’s unexpected re-engagement with the Iranian regime is a change of tactics, not strategy; a bearhug, intended to squeeze the belligerency out of its nemesis.
  • The Saudis’ intention is to feed a starving Iranian population, build their crumbling roads, bridges, waterways, and urban infrastructure, and empower the Iranian people to regain their dignity and identity; then use its economic leverage to derail the nuclear program and bring down the terror-sponsoring ayatollahs with it.
  • If the Saudis thought rapprochement would enable Iran to move closer to achieving its nuclear ambitions, they would obviously not pursue such a deal. The conclusion must be drawn, then, that this is a move intended to stop or at least stymie their menacing neighbor.
  • Meanwhile, a functional rapprochement between Israel and Saudi Arabia has been in place for a number of years and is progressing, qualitatively and quantitatively, at an impressive rate.

Not as It Appears

With the announcement of the rapprochement between Saudi Arabia and Iran, it appeared that the strategic direction of the Middle East had reversed course.

What seemed to many as a one-way drive along the Abraham Accords freeway toward normalization and peace was suddenly thrust across the political guardrail into oncoming traffic. An embrace of Iran appears, prima facie, to be a shunning of Israel.

However, while that reading is a possible interpretation, it is an unlikely one. Instead, we will argue that the Saudi Arabia of Mohammed bin Salman is committed both to depriving Iran of nuclear weapons and, at the same time, gradually normalizing relations with Israel.

A Nuclear Iran Is Not an Option for Saudi Arabia

The suggestion that Saudi Arabia has embarked on a rapprochement with Iran must contend with the simple question: Do the Saudis suddenly feel less threatened by a nuclear Iran? There is absolutely no reason to assume they do.

Discussion about the Iranian nuclear threat often neglects or avoids the full parameters of the problem. The threat should not be measured only in binary terms of whether they will or won’t use the bomb. That is clearly a concern, as the theory of “mutually assured destruction” (MAD) does not apply to the apocalyptic clerics in Tehran as it did to the politburo in Moscow.

The severity of the danger, though, begins not with the actual detonation of the bomb, but with the threats that extend from its existence in Iranian hands. Iran and Saudi Arabia are in effect in a cold war in which military confrontation is carried out by proxy in the failed and weaker states of the region.

Iran is conducting proxy wars with all of Saudi Arabia’s immediate neighbors. A victory for the Iranian-backed Houthis in Yemen would mean a belligerent entity along the Saudi southern border and control of waterways such as the Gulf of Aden, Bab el Mandeb, and the Aden Sea, which are lifelines for shipping and travel. In Iraq, Syria, and Lebanon, Iran has provoked protracted civil wars that threaten Saudi Arabia, its neighbors, allies, and interests. In Jordan, Egypt, and Turkey, Iran supports terror organizations, has fomented unrest among the Shiite population of Bahrain, and has stirred the pot in Sudan’s civil war. According to a 2021 UN report on terrorism, sub-Saharan Africa has become the epicenter of terrorism expansion,1 mainly orchestrated by Iran. And it is Iran that funds and trains the Hamas and Hizbullah terror organizations.

If we imagine for a moment that Iran shielded these proxy wars under the protection of a nuclear umbrella, it is not hard to understand the level of devastation and destruction that would ensue. The levels of chaos and instability would go unchecked and grow exponentially, leading to increased ethnic strife, civil wars, food scarcity, and human suffering on a massive scale. Contending with a state sponsor of terrorism is one thing; contending with a state sponsor of terrorism with nuclear weapons is something else entirely.

One example: The media has been full of reports, unsubstantiated for the most part, that the rapprochement will lead to an end to the civil war in Yemen. Conjecture for a moment that a truce is ironed out and the fighting is put on hold. Are the chances lesser or greater that the fighting will resume once Iran’s enrichment program has “broken out” and weaponized?

The Saudis are shrewd and accomplished diplomats, masters at unraveling the mysteries of Middle East intrigue, and there are no better experts at identifying the duplicitous nature of the ayatollah regime. If the Saudis thought rapprochement would enable Iran to move closer to achieving its nuclear ambitions, they would obviously not pursue such a deal. The conclusion must be drawn, then, that this is a move intended to stop or at least stymie their menacing neighbor.

From Rapprochement to Reversal

Popular unrest among the Iranian people has not toppled the regime. Not yet. Since the killing of Mahsa Amini in police custody on September 16, 2022, demonstrations have been strong and consistent. Since the protests started, at least 600 people have been killed by security forces and a further 22,000 arrested.2 The authorities have not lost control, but the anger is palpable and spreading. Hundreds of thousands of labor union members have gone on strike, and reports from inside the country to Iranian exiles indicate that dissatisfaction with the regime is reaching levels never experienced before.3

It is little wonder that this is the case, as the economy is imploding, inflation is soaring, and people are hungry.4 In a private conversation, one noted exiled Iranian economist compared the situation to Indian economist Amartya Sen’s revelation on the Bengal famine: there was plenty of food, but nobody had the “capability” or purchasing power to buy it. Over the past 44 years since the Khomeini revolution, the Iranian population has nearly tripled, while the economy has less than doubled, meaning everyone has a lot less money in their pocket. Add to that the country’s runaway inflation and you have human suffering on a massive scale.5

There has been no development of capital in Iran; hence, in order to keep up with current expenditures, funds are consistently taken from the national budget – or at least part of the budget. A full 60 percent of the country’s budget, from the outset, is unscrutinized by the parliament and used instead as a discretionary fund for the ayatollahs. It is no wonder that ayatollah loyalists live like royalty, while over 70 percent of the country subsists below the poverty line. Iran’s policy of uneven distribution of wealth is on steroids. The government distributes the most minimal of stipends to keep people alive with basic foodstuffs. These stipends aren’t enough to prevent thousands of poor Iranians from selling body organs in order to feed their families.6

The remaining 40 percent of the budget is for government expenditures and falls under the scrutiny of the parliament, which has to make its own payoffs to those close to the economic food chain. The result: 86,000 development projects, 6,000 nationwide projects under the auspices of the federal government, and 80,000 projects belonging to the provinces that have not even been initiated. These neglected projects run the entire gamut of basic development, from water and waste treatment to roads and bridges, hospitals and schools.

A massive influx of Saudi cash to these projects will not only create jobs and inject capital into Iran’s economic system, it will create an economic and societal dependency that Saudi Arabia can leverage to effectuate change.

This won’t be money from Western powers formerly trying to “buy off” the ayatollahs, but rather Iran’s most significant neighbor, a competitor for supremacy in the Arab world, investing in the people of Iran. This won’t be lost on the Iranian people who have suffered for so long under the clerical boot. A Saudi threat to halt projects that have begun would thrust the social economics back to the status quo ante, and could turn the current anti-government activity into a promo of what will come. It can turn civil unrest into revolution.

Because the Chinese are politically and economically in need of a quiet Gulf region, were the Saudis to halt or withdraw their financial involvement in direct confrontation with Tehran, Chinese investments would be compromised as well, increasing the leverage over Tehran and forcing change.

The China Angle

The talks between Iran and Saudi Arabia were ongoing for years under Omani mediation but went nowhere. Fundamentally, there is little the two countries can agree upon. What has changed is not any newfound bilateral understandings, but rather “small cold war” (Iran-Saudi) interests that have been moved into the “larger cold war” (U.S.-China) realm.

First, China’s interest in brokering a rapprochement between the Middle East’s two opposing behemoths needs little explanation. In the new “superpower Cold War” that is already underway and threatens to intensify, replacing the United States as the indispensable power in mediating the Middle East’s regional Cold War is a treasure in global power politics.

U.S. Navy Fleet Tracker, September 13, 2021, showing deployed Carrier Strike Groups and Amphibious Ready Groups
U.S. Navy Fleet Tracker, September 13, 2021, showing deployed Carrier Strike Groups and Amphibious Ready Groups. The last time an American aircraft carrier was in the Gulf area. (U.S. Naval Institute)7

The U.S. has reduced its military posture dramatically, with the number of troops in the Central Command (CENTCOM) down 85 percent from its peak in 2008. With the exception of a few hundred American advisors in Iraq, a small contingent of Special Forces in Syria, and some administrative staff in Bahrain, the United States has left the Middle East for the Far East. A U.S. Navy aircraft carrier has not operated in the Middle Eastern waters of the American 5th Fleet since U.S. forces pulled out of Afghanistan in August 2021,8 and regional supply lines have been left unpatrolled. This U.S. pivot to the east is in keeping with the U.S. national security strategy to focus on the threat to its allies – Korea, Japan, and Taiwan – from an expansionist China. The United States exits and China enters, claiming the mantle of indispensability and strengthening its standing internationally.

Second, China does $130 billion in trade in the Gulf and does not want to have to choose between Iran and Saudi Arabia, the two countries at loggerheads. It also receives 36 percent of its energy needs from the two countries. So from a purely economic perspective, lowering tensions between Iran and Saudi Arabia is a Chinese national interest. If the conflict boils over into Ukraine-Russia proportions, the price of oil could hit levels never experienced before, with all the attendant effects involved. This is also a main reason why the West, including the United States, voiced satisfaction with the China-brokered agreement.

Saudi Arabia also largely benefits financially from China’s mediation. Not only is China the largest buyer of Saudi crude, but as a result of the deal, the Saudis will be able to store enormous amounts of crude oil in China, which will facilitate a much faster supply chain to Asian countries. The continued Saudi-China cooperation in the development of ballistic missiles will also be joined by dozens of investment projects in green energy, technology, cloud services, transport, and more.

Third, by donning the mantel of a peacemaker, especially between the leaders of Sunni and Shia Islam, China deflects troubling Western criticism of its abysmal human rights record, particularly as it relates to the over one million Muslim Uyghurs in “re-education” camps.

The Unenviable Saudi Alternatives.

Saudi Arabia’s return to diplomatic relations with Iran was not the Saudi leadership’s first choice. It would have preferred to rely exclusively on the United States to ensure that Iran did not get the bomb, but in Saudi eyes, that became a course fraught with doubt, indeed with danger.

There are strong political, ideological, and academic currents in the United States advocating for moderation and tolerance regarding the prospect of a nuclear Iran. When that is taken into account, together with the JCPOA, a deal the Saudis believe threw them under the bus (with the approval of then Vice President Joe Biden); the disorderly withdrawal from Afghanistan; the orderly U.S. downsizing in the Gulf; and the ignoring of missile attacks on Saudi territory and Saudi oil tankers by Iranian and Houthi missiles, American promises that Iran will not be allowed to go nuclear ring hollow to Saudi ears. And with justification, they are not alone.

Remains of a Shaheh-123 unmanned aerial vehicle
Remains of a Shaheh-123 unmanned aerial vehicle are part of a display at Joint Base Anacostia-Bolling in Washington, D.C. The Defense Department established the Iranian Materiel Display in December 2017. (U.S. Department of Defense)
A close-up of a component of an Iranian Qiam ballistic missile fired into Saudi Arabia
A close-up of a component of an Iranian Qiam ballistic missile fired into Saudi Arabia. It bears the logo of the Iranian Shahid Bagheri Industries and was displayed at an Iranian Materiel Display at Joint Base Anacostia-Bolling, Washington, D.C., on November. 29, 2018. (U.S. Department of Defense)

Saudi leadership believes that President Biden has removed some sanctions against Iran absent any quid pro quo,9 and views the Iranian nuclear issue as binary: either use military means to stop them from getting the bomb, or allow them to have the bomb and then rely on deterrence. Understanding this, the Iranians have consistently upped the ante in negotiations (and in the conditions they set for negotiations), and the Saudis, for their part, watch in amazement and conclude that, similar to other American allies in the recent past, they will be left to fend for themselves.

The Saudi conclusion: Create the conditions for Iran to collapse from the inside rather than rely on an attack from the outside. Bring the Chinese along because 1) only they can bring the Iranians to the table, and 2) only their involvement as a “replacement” for the United States could lure the Americans back into the equation and restore the initial and preferred option of stopping Iran militarily.

Normalization with Israel

Good intentions aside, Israelis are mistaken when they put peace with Saudi Arabia in the context of the Abraham Accords. The Kingdom is not just another Muslim country normalizing relations with Israel; it is on an entirely different plane.

Based on conversation and correspondence with Saudis, it is evident to this author that that is how the Saudis see themselves and expect it to be understood. Saudi Arabia is the birthplace of Islam, the custodian of Islam’s holy places, and is a principal leader of the Islamic world economically, spiritually, politically, and even militarily. Peace between it and Israel has an almost pervasive sense about it, in time, theology, and global politics. It would be a historical rapprochement between the Muslim world and the Jewish nation.

Robert Satloff, a doyen of Middle East analysts, sets things right when he writes: “Will Saudi Arabia normalize with Israel soon” is the wrong question to ask. “That is because it considers normalization with Israel as a binary issue – yes, no; now, not now; soon, not soon. In practice, normalization is not an act, it is a process. And normalization does not exist in a vacuum but as part of a larger set of policy choices defined by a government’s assessment of its strategic priorities.”10

Saudi Arabia has not kept its strategic priorities secret. They are: 1) A commitment to Saudi security that parallels a NATO alliance and defense pacts. 2) A no-strings-attached commitment to sell the Kingdom high-grade weaponry. 3) A U.S.-Saudi partnership in developing full civilian nuclear fuel cycle infrastructure. To what degree these Saudi priorities would have to be accepted, whether in full or in part, for normalization with Israel to follow is exactly what is playing out in negotiations.

Most conspicuously absent from the list of Saudi priorities is a demand for acceptance of its 20-year-old Arab Peace Initiative, which moves Israel back to its pre-1967 borders and creates a full-fledged Palestinian state with Jerusalem as its capital. The linkage that does exist is carefully and moderately worded, calling for “positive movement” toward peace between Israel and the Palestinians.

This is not as surprising as it first appears. The social and cultural reforms that Crown Prince Mohammed bin Salman (MbS) has initiated are predicated on the basis of a young generation of Saudis who are pining for change. The tens of thousands who cross the bridge to Bahrain every weekend to party are as uninterested in the Palestinian issue as they are interested in understanding and benefiting from the start-up nation in their neighborhood. Many express enervation and exasperation over the Palestinian issue, feeling that dogmatic commitments to the issues of yesterday are preventing them from enjoying a more promising future. And many others, still concerned about the Palestinians, have come to understand that normalization with Israel will advance their humanitarian needs more than the continued entrenchment in complicated political claims and historical issues whose times have long passed.

Reasons for Optimism

Saudi Arabia is not about to acquiesce to a nuclear Iran. Like any other country, it is acting in its own best interest and pursuing the modus operandi that will prevent its malevolent neighbor from attaining a weapon of mass destruction.

It is working to bring the full power of the United States back into the region, and if the requisite tactic for doing so is a diplomatic romp with China, then so be it. The recent arrival of the USS Florida, a nuclear-class submarine loaded with 154 Tomahawk missiles and a squadron of A-10 Thunderbolt II aircraft (“Warthogs”) that have been saddled with structure-penetrating payload (bunker-buster bombs),11 may be a good indication that the Saudis are succeeding in their entreaties.

Another strong indication may be found in remarks on May 4, 2023, by U.S. National Security Advisor Jake Sullivan, in a speech to the Washington Institute: “[W]e have made clear to Iran that it can never be permitted to obtain a nuclear weapon. As President Biden has repeatedly reaffirmed, he will take the actions that are necessary to stand by this statement, including by recognizing Israel’s freedom of action.”12

And lastly, in an act of confident self-reliance, Saudi Arabia is committing to use its economic power within Iran to force a change of policy or government, or both.

Conflict resolution needs to look at the functionality of normalization, not peace-signing ceremonies. The declared rapprochement between Iran and Saudi Arabia should be judiciously monitored, as it is what happens on the ground in the next months that will determine its effects on the region.

It should be remembered, though, that a functional rapprochement between Israel and Saudi Arabia has been in place for a number of years, and is progressing, qualitatively and quantitatively, at an impressive rate. From joint business ventures to meetings of intellectuals and policy researchers at international conferences, from Saudi Arabia opening its airspace to Israeli overflights and Israeli participants at sports events on Saudi soil, to the Kingdom’s blessing of the Abraham Accords, the rapprochement with Israel is practical, while the rapprochement with Iran is, as yet, declarative.

And as I have argued, Saudi Arabia’s rapprochement with Iran might actually be the cleverest aspect of the ongoing Saudi rapprochement with Israel.

* * *



  2. Amir Taheri, “Iran and Its Culture War,” Gatestone Institute, April 30, 2023.↩︎

  3. Amir Taheri, ‘Iran: Unhappy Workers,” Gatestone Institute, May 7, 2023.↩︎

  4. See,↩︎

  5. Until the Khomeini revolution, Iran was a country with a strong and growing economy, but since 1979, Iran’s economy has failed its people and is currently in the midst of a severe economic crisis. The middle class has been decimated and instead of providing financial stability to the lower classes, the central bank has inflated the Tomans’ currency by 40 to 50 percent. The multiple exchange rate system Iran has used over the years is partially to blame for the present catastrophe. Over the past forty-four years the General Price Level and the Consumer Price Index have increased by more than 5450 times, meaning that one Toman in 1979 was equivalent to 5450 Tomans in 2022. At the same time, the nominal earnings of employees increased between 3500 and 4000 times. In simple terms, prices increased while wages did not, resulting in a tremendous impoverishment of society.

    Ironically, the Islamic Republic reports its GDP based on an “official” exchange rate rather than the market exchange rate, in an attempt to mislead the world about their enormous financial crisis. For example, they report a rate of 4200 Tomans per dollar to international institutions, whereas the market rate is 54,000 Tomans per dollar. See, Prof. Hassan Mansoor, “The Recalcitrant U.S. Dollar within Iranian Economy” Hassan (March, 2023), and, Hassan Mansoor, “Is Iranian Economy at the Neighborhood of Singularity?” Printed in the London Independent in Farsi, and at Hassan↩︎

  6. Benjamin Weinthal, “Iranians sell organs abroad due to regime ‘corruption,’“ The Jerusalem Post, May 7, 2023.↩︎


  8. General Michael Kurilla, “Statement for The Record,” General Michael ‘Erik’ Kurilla Commander, US Central Command Before the Senate Armed Services Committee On The Posture Of US Central Command, Testimony before the Senate Armed Services Committee, March 13, 2023. ( In, Bradley Bowman, Orde Kittrie, and Ryan Brobst, “The United States and Saudi Arabia: a Possible Path Forward,” Foundation for the Defense of Democracies, April 28, 2023.;↩︎

  9. See, Kali Robinson, “What Is the Iran Nuclear Deal?” Council on Foreign Relations, July 20, 2022.↩︎

  10. Robert Satloff, “Saudi Normalization with Israel, Domestic ‘Transformation,’ and U.S. Policy,” The Washington Institute for Near East Policy, May 2023, NO. 133.↩︎

  11. Dion Nissenbaum, “U.S. Arms Warplanes With ‘Bunker Busting’ Bombs in Message to Iran

    The Air Force’s A-10 Warthogs are carrying 250-pound precision-guided weapons in the Mideast” WSJ NEWS EXCLUSIVEWORLD, April 28, 2023.↩︎