Iran is not the only ascendant power in the Middle East. Saudi Arabia, its regional rival, has also seen its fortunes rise. Thanks to high oil prices, the country’s gross domestic product has doubled to $350 billion over the past four years. Saudi leaders also face easing pressures from Washington on democracy promotion, due to the Bush administration’s troubles democratizing Iraq, not to mention elections in Lebanon and the Palestinian territories that brought Islamist parties to power. Emboldened, the House of Saud has taken “on the long-abandoned mantle of Arab leadership,” argues the Economist, particularly on issues like the Israeli-Palestinian peace process.
Sunni Arab fears of a rising Shiite Iran have only strengthened Saudi Arabia’s position. It has also helped lessen the tension Saudis feel toward Israel. With Iran now the “evil empire,” writes Simon Henderson of the Washington Institute for Near East Policy, “Israel almost stops being an enemy and perhaps becomes an ally.” On Lebanon, the Saudis have angled for position to ensure that Iranian-backed Hezbollah does not oust Fouad Siniora's government in Beirut. And on the Palestinian issue, Riyadh has spearheaded a new power sharing arrangement that draws new borders (to reflect pre-1967 realities) and addresses the Palestinian refugee situation. Even though the deal may not please Saudi Arabia’s U.S. allies, “the Iranians have had their wings clipped,” says F. Gregory Gause III, in a new interview with CFR.org’s Bernard Gwertzman. The peace proposal will get hashed out at the Arab League summit, hosted by Saudi Arabia, on March 28.
Saudi Arabia’s most pointed actions in the region are targeted at Iran. Saudi leaders have threatened to intervene more directly against Iranian influence in Iraq, saying they will side with the Sunnis (NYT) in the event of a U.S. withdrawal. Earlier this year Riyadh also implicitly targeted Iran’s economy, proposing to boost oil production and thus drive prices down (this Backgrounder examines Tehran’s damaged energy sector). The implications of an intensified Saudi-Iranian duel in the region are grave. As CFR Adjunct Senior Fellow Vali Nasr noted testifying in January before the Senate Foreign Relations Committee, the rivalry between the two countries in Afghanistan and South Asia in the 1980s and 1990s “served as the context for radicalization that ultimately led to 9/11.”
Besides Iran’s support of Shiite militias in Iraq, the Saudis remain concerned over Tehran’s determination to develop a nuclear program. “They’re worried this is a return back to Khomeini-ism,” former CFR Fellow Rachel Bronson told CFR.org’s Gwertzman. The Saudis, along with the Egyptians, have dropped hints they would pursue a nuclear program in response to a nuclear-capable Iran.
These heightening sectarian tensions formed the backdrop to the recent summit between Iranian President Mahmoud Ahmadinejad and Saudi Arabia’s King Abdullah. The purpose of the meeting was to address the Sunni-Shiite split and work to resolve areas of disagreement on Iraq (namely, Saudi support for the insurgents and Iranian support for the militias). However, no firm agreements (NYT) materialized from the meeting.
The Saudi-Iranian elbowing for position in the Persian Gulf region also has important policy implications for the United States. CFR Senior Fellow Peter Beinart cautions that “turning U.S. foreign policy over to the Saudis” or allowing Riyadh to serve “as our proxy against Iran” is “perilous,” as it threatens to “enmesh us in a Middle Eastern cold war (TIME), fought along religious lines.”