Once the focal point, the conflict between Israelis and Palestinians already lost its pivotal importance for Middle East politics decades ago. The main reason was the 1973 Yom Kippur War, which was accompanied by an unprecedented jump in oil prices that in turn led to the rise of the Gulf states and a shift in the geopolitical center of gravity of the region away from Tel Aviv/Jerusalem, Cairo, and Damascus toward Riyadh, Tehran, and Baghdad. While Saudi Arabia, Iran, and initially Iraq became regional heavyweights due to their oil wealth, countries like Egypt and Syria lost the strong roles they once played.
The major conflicts of the ensuing decades were fought in the Gulf, including the Iran-Iraq War of 1980–88, the Kuwait War of 1990–91, and the Iraq War of 2003, all of which took place against the backdrop of the conflict between Saudi Arabia and Iran, which after Iraq’s collapse fought increasingly fiercely for hegemony in the Gulf. The Israeli-Palestinian dispute seemed a sideshow by comparison.
On the face of it, the Hamas attack on Israel on October 7 and the subsequent war over Gaza may contradict this picture, because suddenly the whole world is once again looking at Israel and the Palestinian territories. However, the Gaza conflict is gaining importance above all because of its potential for regional escalation, without which, despite all the horror and drama of the events, it would again be only an episode in the conflict between Palestinians and Israelis, confined to that small territory. If the rallying calls are to be believed, Hamas appears to be seeking to draw the Lebanese Hezbollah and also Iran into the war, to avoid being completely alone in the face of Israeli attacks and to force the enemy to fight on at least two fronts.
Iran’s Expansionist Ambitions
This turns the conflict into a consequence of Iran’s expansionist ambitions and the attempt by the Tehran leadership to build an “axis of resistance” against the United States and its allies together with Hezbollah, the Assad regime in Syria, Hamas, the Yemeni Houthis, Iraqi militias, and other terrorist groups and to gain supremacy, first in the Gulf and then in the Middle East as a whole.
This close connection to the conflict in the Persian Gulf may be even stronger than could be proven so far, because information may still come to light about Iran’s and/or Hezbollah’s involvement in planning the attacks in Israel. So far, however, there are only indications that Hezbollah, and thus probably Iran, knew about the planning shortly before October 7—but no information that they exerted any influence. The suspicion that their involvement may have been greater than that is plausible mainly because Hamas, Hezbollah, and Iran largely share the same interests.
Saudi Arabia and Israel
Hamas’ aim in attacking Israel was to prevent a peace agreement between Riyadh and Tel Aviv. Such a deal would be a serious setback for Iran, Hezbollah, and Hamas. Yet Israel and Saudi Arabia have not been hostile to each other for a long time. One important reason for this has been that they are both closely allied with the United States, so that their interests often overlap.
This became particularly clear in 2002, when the then Saudi Crown Prince and later King Abdallah offered peace to Israel if it withdrew to the 1967 borders. Since then, there have been repeated secret meetings between Saudi and Israeli politicians and officials. Both sides talked mainly about security issues, which became increasingly urgent as a result of Iran’s intensified expansion in the Middle East from 2015. Riyadh and Tel Aviv see the Islamic Republic’s aggressive hegemonic policy as the greatest threat to their national security, so a rapprochement was almost inevitable.
In addition, from 2017 onwards, former US President Donald Trump came along as an actor who promoted rapprochement between Israelis and Saudis aimed in part at building a broad front against Iran. From the beginning of his presidency, Trump maintained close and friendly relations with Saudi Crown Prince Mohammed bin Salman, the then Crown Prince of Abu Dhabi, Mohammed bin Zayed, and with Israeli Prime Minister Benjamin Netanyahu. Together with his son-in-law and key advisor Jared Kushner, whom he made his Middle East envoy, Trump resorted to the old US Republican approach of seeking to resolve the Israeli-Palestinian conflict by having pro-Western neighboring states make peace with Israel, bypassing the Palestinians.
The fact that the United Arab Emirates (UAE) and Bahrain concluded peace agreements with Israel at the same time in 2020 was a great success for the US. Bahrain’s participation in particular was remarkable because the small island kingdom is effectively a Saudi protectorate, so it could be assumed that Riyadh had given its consent. Nevertheless, Saudi Arabia did not join the agreement because King Salman insisted that a peace accord with Israel had to be accompanied by the establishment of a Palestinian state.
It was only during Joe Biden’s presidency that the talks on a normalization between Israel and Saudi Arabia gained new momentum. In March 2023, reports became public that Riyadh was demanding more modern weapons, far-reaching security guarantees, and help in building a civilian nuclear program from the US if it was to agree to peace with Israel. At the time of the Hamas attack on October 7, 2023, talks between the US and Saudi Arabia were still ongoing.
Saudi Arabia and Iran: End of the “Cold War”?
The events of October 7 also surprised many observers because the signs in the Middle East of 2023 seemed to be pointing more toward détente. Optimists were particularly impressed by a China-brokered agreement between Saudi Arabia and Iran in March 2023 in which the two regional heavyweights had promised to ease tensions. The agreement seemed to end the Cold War that the two states had waged for about a decade and that had fueled conflicts in Syria, Iraq, Lebanon, and Yemen. But the fault lines of the dispute between Iran and its adversaries remained, as the October 2023 attack by Hamas demonstrated all too clearly.
The conflict between Saudi Arabia and Iran had escalated from 2015 onward in particular. Saudi Arabia (and other pro-Western states such as Israel and the UAE) attributed this primarily to Iran’s nuclear program, which they considered to be a military one, Iran’s expansion in the region, which was accompanied by support for anti-US, anti-Israeli, and anti-Saudi organizations such as Lebanon's Hezbollah, and its missiles with which Iran and its allies threatened their neighbors. Saudi Arabia opposed Iranian expansionism primarily in Yemen, where Iran-backed Houthi rebels seized the capital Sanaa in 2014 and subsequently took over large parts of the country. The kingdom, together with the UAE, intervened in the civil war on the side of the Houthis’ opponents in March 2015.
However, Riyadh and Abu Dhabi failed to achieve the expected quick victory, and a years-long conflict developed during which the Houthis grew stronger. The attacks on Saudi cities and infrastructure with missiles, cruise missiles, and drones, which intensified from 2017 onward, had a particularly strong impact. In September 2019, one such attack—which the Houthis claimed responsibility for, but which originated in Iran—hit the Saudi oil facilities of Abqaiq and Khurais, crippling a good half of the country’s oil production for a fortnight.
Saudi leaders hoped for an American military strike against Iran, but when President Trump refused, Crown Prince Mohammed realized that his country’s oil infrastructure was defenseless against the Houthis’ and Iranians’ attacks. Therefore, Saudi Arabia quickly sent signals of détente toward Tehran.
It took more than two years to reach an agreement with Iran and to scale back hostilities in Yemen largely because Tehran, aware of its own strength, saw no reason to respond to the Saudi advances. This only changed in 2022, when the end of the nuclear negotiations with the US made it clear to the leadership in Tehran that there was no longer any prospect of Western sanctions ending soon. This factor, against the backdrop of a severe economic crisis and the nationwide protests that broke out in September, was deemed such a threat that Tehran, too, chose to opt for a course of détente.
No Peace, No Détente?
The Hamas attack and the new Gaza war could now make peace between Israel and Saudi Arabia impossible. While the US and Israel have a very strong interest in an agreement being reached, Saudi Arabia still seems to be weighing the pros and cons and hesitating whether to make such a clear commitment to the West—when, in Riyadh’s view, the US is on the retreat from the Middle East and China is expanding its influence. The Saudi leadership suspended talks with the US in mid-October and decided to wait and see how the conflict progresses. Even if Crown Prince Mohammed is planning to resume the talks soon, the US timetable is already in tatters. The Biden administration wanted to deliver the first results by the end of the year to pave the way for an agreement to be concluded before the US elections in November 2024. Whether this will still be possible is written in the stars.
A further problem is that Hamas is aiming for a regional escalation of the war around Gaza. This became clear on the first day of the attack, when Hamas military leader Mohammed al-Daif emphasized in a speech how closely his organization was linked to the Iranian-led “axis of resistance.”
Hamas apparently hopes for an expansion of the conflict to Israel’s northern border, where the far more powerful Hezbollah threatens Israel like Hamas does in the south. Even if it seemed at the beginning of the conflict that Iran and Hezbollah did not want a war with Israel, at least for the time being, the danger of an uncontrolled escalation is ever present—not least because Hezbollah, in order to show a little solidarity with Hamas, has sporadically fired rockets at Israel. Saudi Arabia fears that it, too, would become the target of Iranian attacks in the event of an escalation.
This is one reason why the US government ordered the aircraft carriers USS Gerald R. Ford and USS Dwight D. Eisenhower to the eastern Mediterranean shortly after the Hamas attack. Like Israel, it wants to prevent a regional escalation of the conflict—and thus also preserve the option of peace between Israel and Saudi Arabia.
Guido Steinberg is a Middle East expert who works at the German Institute for International and Security Affairs (SWP).
