Saudi Arabia and Iran mend ties

Following secret talks in Beijing, Saudi Arabia and Iran have surprised the world by announcing the restoration of their diplomatic ties. The rapprochement could have numerous consequences for the balance of power in the Middle East. Due to its partisan posture and military presence in the region, the United States has been unable to act as a reliable mediator. Meanwhile, China has leveraged its neutrality and economic influence to secure an unexpected agreement.

Successful Chinese mediation between the historical Gulf rivals is perhaps the clearest sign yet of a changing global order. Saudi Arabia has continued its shift away from the US towards BRICS, attempts at isolating Iran are failing, and Beijing has managed to position itself at the epicentre of responsible global diplomacy. While the US has sought military confrontations to assert its dominance, China has promoted negotiated settlements as a better alternative. The strategy seems to be working.

The bitter rivalry between Shia Iran and Sunni Saudi Arabia has been a defining feature of Middle Eastern conflicts in recent years. In war torn Yemen, Houthi rebels, backed by Iran, have challenged the Saudi-backed Yemeni government in a brutal decade-long war. Diplomatic relations were halted in 2016 after Saudi Arabia executed a prominent Shia Muslim scholar and irate Iranian protesters attacked the Saudi embassy in Tehran.  

The situation deteriorated further, when in 2019, the Houthis targeted Saudi oil facilities, causing a temporary halt in the country's oil production and the largest spike in global oil prices in more than ten years. It is hoped that the recently repaired relations could see the end of Houthi attacks on the Kingdom and a peaceful resolution to the war. Considering the risks the war has presented to global oil supplies, the latest agreement should help enhance global energy security.

China’s indifference to other countries domestic politics seems to be bearing fruit and the agreement even includes provisions for respecting state sovereignty and the non-interference in internal affairs. In contrast, American criticism of Saudi Arabia’s human rights record has led to a souring of relations.

For the Saudis, the deal opens up new possibilities beyond its historical oil for weapons partnership with the US. As Saudi Arabia’s largest trade partner, China can offer the Kingdom increased economic opportunities as it seeks to diversify its economy away from an overreliance on oil revenues. This in turn will grant Saudi Arabia greater political autonomy.

In addition to the reopening of embassies, the recent deal includes a return to earlier security and trade agreements, which despite US sanctions, could result in increased Saudi investments in Iran. This signals Saudi Arabia's willingness to conduct foreign policy independent of the US which may impact the ability of the United States to isolate Iran.

Shift In The Balance Of Power

Having remained neutral in the historical conflict between the two Gulf giants, China has found itself in a strong position to negotiate an agreement. The pursuit of a diplomatic resolution was a risk free exercise for the Chinese, because unlike Washington, they are not committed to one particular side. As such, the pact highlights the growing shift in global power from the United States to China as the most significant player in the sphere of international relations. 

The significance of the pact between Iran and Saudi Arabia is further underscored by the fact that China was able to broker a deal in a matter of days. Meanwhile, the US has failed to negotiate the normalization of ties between Saudi Arabia and Israel despite attempts beginning during the Trump administration. Although Saudi Arabia changed its policy to allow flights between Israel and the gulf states to pass through its airspace, Riyadh has thus far refused to join the Abraham Accords, which witnessed the historic normalisation of Israel’s relations with the UAE and Bahrain.

Improved diplomatic ties between Saudi Arabia and Iran could have significant implications for the region, shifting the balance of power away from the US to regional powers. Hopefully this reduces the likelihood of a military confrontation. Israel may be reluctant to act against Iran without support from the US, who may in turn be reluctant to act against Iran without the support of Saudi Arabia.

The recent rapprochement between the two oil producing states also bodes well for the BRICS bloc. Both countries have applied to join the group of emerging market economies. If the BRICS had only welcomed Iran, it may have fostered the idea of BRICS as an anti-Western alliance which is certainly not the case. But if the BRICS had welcomed Saudi Arabia and not Iran this may have been perceived as a move to appease the West which is equally inappropriate.

Admitting both nations would have been contentious if they had remained on bad terms with each other. This could have destabilised the bloc and caused divisions even though the current members enjoy warm relations with both countries. The recent reconciliation between Saudi Arabia and Iran paves the way for BRICS expansion to include both countries.

Perhaps we are witnessing a shift in the global balance of power as US hegemony gives way to new partnerships and alliances. Saudi Arabia and Iran have chosen to work together to restore regional stability. Meanwhile, China continues to utilise its economic might to achieve diplomatic outcomes, which has seen Beijing emerge as the world’s most important and influential dealmaker.