It’s the story that keeps making headlines this summer, despite its lack of apparent legs: The administration of US President Joe Biden is seeking a grand deal for Israeli-Saudi normalization, backed by an upgrade in US-Saudi relations to include a formal security guarantee and Israeli concessions on the Palestinian issue — seen as key to any Saudi buy-in. The hurdles are undeniably high, starting with the most right-wing government in Israeli history, bent on expanding settlements and possibly annexing parts of the West Bank, where the Palestinian Authority is in disarray.
US-Saudi Reset?
But for Washington, the potential payoffs are considerable. Resetting the US-Saudi relationship could, in Washington’s eyes, help counter the blossoming Saudi-China relationship, which took on broader geopolitical tones with the Beijing-brokered Saudi-Iranian rapprochement in March, notes Kristian Coates Ulrichsen of Rice University’s Baker Institute. The thinking seems to be around how to reattach Saudi Arabia to the US-led order, he says, after the Saudis set out a more non-aligned position, working with Russia, China and the US in an increasingly multipolar world. A deal could also reinforce the US security presence around key oil and commercial shipping transit points.
Israel’s inclusion is an imperative for the US, argues Hussein Ibish of the Arab Gulf States Institute in Washington. “There really isn't any a solid basis for a bilateral US-Saudi deal” that gives each side what they are looking for, he says, “unless it’s triangular.” The domestic political climate in the US means a deeper security guarantee for Saudi Arabia has to be “tethered to normalization with Israel.” Bringing Israel into the equation would make it harder for Congress and voters to object to a deeper US-Saudi security relationship.
Although aligning US, Israeli and Saudi interests appears to be an uphill battle, multiple visits by high-level US officials to the kingdom in recent months attest to the seriousness of Washington’s aspiration.
Filling the Vacuum
The longstanding US-Saudi relationship, centered around oil for security, has been in flux for some time. The Mideast Gulf region has undergone “traumas of abandonment,” as Ibish put it, which include the US’ failure to support former Egyptian strongman Hosni Mubarak during the Arab Spring and its agreement of a nuclear deal with Iran in 2015. Washington’s underwhelming response to the devastating 2019 attacks on Saudi production capacity seemed to ram the message home.
In tandem, a new leadership was emerging in the region, led by Crown Prince Mohammed bin Salman in Saudi Arabia and Sheikh Mohammed bin Zayed in the United Arab Emirates. This played out in more assertive and independent positioning in the region (over Yemen and Qatar, in particular) and globally, as both eyed alternative or additional international partnerships. A rising China offered investment, technology, markets and more, while Russia brought additional oil market clout through Opec-plus.
Russia’s invasion of Ukraine further complicated the US-Saudi dynamic. Tensions between the two over Opec-plus production cuts spilled into public view last October, with Washington arguing Saudi Arabia was effectively supporting Russia through its Opec-plus policies. But the crisis, including that blowup, seems to have prompted a reexamination by the Biden administration of its strategic position — and how its partial pivot away from the region left it poorly placed to ask for support when needed.
The Biden administration has since been trying to show the Saudis that it is more reliable than any alternative partner, including China. In a response to Saudi intelligence about an Iranian threat to the kingdom last fall, the US scrambled F-22s. More recently, the US has increased its naval presence in the Gulf and is mulling putting armed Marines on commercial shipping to deter Iranian piracy. “It’s word and deeds. And especially deeds,” Ibish says.
US Leverage Shortfalls
Washington’s position in the recent meetings illustrates the shifting dynamics. In addition to recognition of Israel, Washington reportedly wants Riyadh to distance itself from China, economically and militarily. The talks focused on these broad strategic objectives rather than near-term oil production and pricing, Energy Intelligence understands.
Saudi Arabia’s reported demands appear more concrete: It wants an Israeli offer that advances plans to create a Palestinian state; a solid security pact with the US and access to more advanced weaponry; and US help on a civilian nuclear program, on Saudi terms. That may mean Saudi autonomy over the entire nuclear fuel cycle, something the US has long resisted as a proliferation risk — and which Israel will also object to.
In some signs of movement, Saudi Arabia last week appointed its ambassador to Jordan, Nayef bin Bandar Al-Sudairi, as its non-resident ambassador to the Palestinians. Ron Dermer, Israel’s minister for strategic affairs and a former Israeli ambassador to the US, is expected to meet with US officials in Washington on Aug. 17.
But other parties have less incentive than the US to push for such a grand deal at this time: Some in the Israeli government value West Bank ambitions more than Saudi ties, while Riyadh has other options for its civilian nuclear program. Within the Gulf, Saudi Arabia's ongoing rapprochement with Iran is seen as lowering regional security risks.
From the Saudi point of view, its energy and economic links to Asia and China now run so deep that it will not want to choose between US and China, says Ulrichsen. “They aren’t going to make that choice. They’ve made that very clear,” he says, including in positioning on the Ukraine war. Instead, in the new, more multipolar world, countries like Saudi Arabia will seek to maintain parallel relationships — with the US, Russia, China and others. Washington will struggle to dial that back.