The November deal struck between the P5+1 and Iran marked a critical turning point in the history of US-Iran relations and Middle East geopolitics. After decades of acrimony, the two sides were able to conduct meaningful negotiations at the highest diplomatic level. Consequently, they crafted a mutually acceptable roadmap for a permanent solution to a complex dispute. For the first time, the US has agreed to negotiate a clearly defined endgame.

These developments represent the emergence of a new policy narrative from Washington, which rejects confrontation in favour of diplomacy. This, in turn, marks the reintroduction of a realist tradition in American foreign policymaking: disengagement from a zero-sum approach that represented the past several decades, and instead adopting a pragmatic view of national interests and a sober understanding of the nature and limitations of power.

Successful normalization of relations between Washington and Tehran would be a prelude to a reconfigured security framework in the Middle East. A more balanced structure of stakeholders that includes Iran could become the new normal. Underwriting this approach is the belief that Iran could, in the words of Secretary of State John Kerry, “rejoin the community of nations and be a constructive contributor.”

This will be a complex process with disruptive elements along the way. Significantly, it will involve the reshaping of bilateral relations between a geopolitically unencumbered Iran and its principal regional rival, Saudi Arabia.

Saudi Arabia’s regional position has been significantly undermined by Iran’s successful forays into the Arab world since the inception of the Islamic Republic.

To counter this, the Saudi leadership has presented Iran as a cultural and ideological aberration from the rest of the region by endorsing sectarian divisions as a tool in a game of geopolitical maneuvering. Thus, when the Arab Spring spilled into Syria as an armed insurrection, the Saudis saw the fall of Damascus as a strategic opportunity to undermine Iran’s regional position. To this end, the Kingdom continues to endorse American military intervention in Syria while expending significant financial resources, alongside Qatar, on the Syrian opposition including jihadi rebel groups.

Saudi efforts in this area have so far failed. First, Washington has little appetite for unilateral military operations, unless its direct interests are at stake. This includes responding to entreaties from a third party to use force on its behalf to promote parochial interests. Second, the success of the Assad regime in regaining control of large sections of Syria is due largely to the disgust felt by many in the opposition and its supporters for the Islamist ideology being imposed by extremist rebel groups, some of which are sponsored by Saudi Arabia.

This explains Saudi Arabia’s ambivalence towards the interim deal with Iran: Riyadh’s official response recognized the deal as marking the first step towards a comprehensive solution, "if there are good intentions." However, in a recent New York Times op-ed the Saudi ambassador to Britain wrote, “this year’s talks with Iran may dilute the West’s determination to deal with [the Iranian and Syrian] governments. What price is “peace” though, when it is made with such regimes?”

Saudi Arabia has for some time been uncharacteristically explicit in its deep dismay for the direction of American policy towards Iran and Syria. On October 18, Saudi Arabia announced that it was rejecting its invitation for the two-year and non-permanent seat on the UN Security Council. The rejection was particularly surprising as Saudi Arabia had for two years lobbied for the coveted position and reportedly given its diplomatic staff special training on Security Council procedures.

In a statement, the Saudi Foreign Ministry said, “the manner, the mechanisms of action and double standards existing in the Security Council prevent it from performing its duties and assuming its responsibilities toward preserving international peace and security as required.” This included criticism of the Council for failure to take firm action on the current crisis in Syria, finding a, “just and lasting solution,” to the Israel-Palestinian conflict, and freeing the Middle East of, “all weapons of mass destruction.”  Subsequently on October 22, Saudi Intelligence Chief Prince Bandar bin Sultan told European diplomats that his country plans to, “shift away,” from close interaction with US security and foreign policy officials.

While this has been interpreted by some as signalling Saudi Arabia’s adoption of an independent foreign policy, such a characterization is inconsistent with a number of factors. For one, Saudi Arabia is a sufficiently sophisticated global and regional actor to understand the limitations of the Security Council in respect of the issues cited. Furthermore, American patronage has long been the anchor of the Kingdom’s security, and for the time being there are no alternative great powers that are militarily capable of fulfilling the same role.

Saudi rhetoric is more likely designed to maintain American support and attention in an effort to shore up its fast diminishing regional positions. The withdrawal from Iraq, the shale gas and tight oil booms in the American heartland, talk of a “pivot” to Asia, and Washington’s decision to forgo military intervention in Syria have all diluted Saudi influence on America’s diplomatic agenda. Moreover, Saudi Arabia has long been used as a buffer against Iranian expansion in America’s regional calculus. These developments, combined with a possible Iranian-American rapprochement will sap Saudi Arabia’s privileged regional position.

Nevertheless, Saudi fears of American abandonment are both exaggerated and unfounded. For decades, American policy in the Persian Gulf has been to prevent other great powers from assuming a dominant position in the world’s oil patch, and much of its global power is derived from its role as the protector of the global supply of oil. On March 18 General Martin Dempsey, chairman of the Joint Chiefs of Staff stated, “You can take it to the bank that the US will maintain its posture in the Gulf for the foreseeable future.” Moreover, America has vast commercial and industrial ties to the Kingdom, most notably in the form of substantial military and defense assistance and cooperation, which continues to expand and deepen. On October 15, the American Defense Security Cooperation Agency announced that it had notified Congress of a possible military agreement with Saudi Arabia that would provide it with an estimated $6.8 billion in munitions and associated equipment, parts, training and logistical support.

Ultimately, Saudi Arabia must adjust to a reality in which American-Iranian hostility begins to decline. While normalization of American relations with Iran will dilute Saudi Arabia’s privileged regional position, it does not necessarily define a zero-sum scenario for the Kingdom. First, a beleaguered Iran is a far greater threat to Saudi Arabia’s security: when the US threatens Iran with military strikes over its nuclear programme, the Persian Gulf states fear that Iranian retaliation will be against them.

Second, a balance of power between Iran and Saudi Arabia, which is contingent on the successful resolution of Iran’s nuclear dossier, can provide the framework necessary for managing their rivalry and fostering their cooperation in matters of regional security. This is most urgent in Syria where their escalating proxy war is transgressing territorial boundaries and has already unfolded a human catastrophe.

Iran’s current foreign policy posture, under the leadership of President Hassan Rouhani and Foreign Minister Javad Zarif, is predicated on an active conciliatory approach towards regional affairs. In his first press conference as president, Hassan Rouhani cited improving regional relations as his top foreign policy priority. Soon after signing the interim nuclear deal in Geneva, Iran reiterated its readiness to start a “new page” in relations with the Persian Gulf states. To this end, in early December Zarif completed a whirlwind tour of UAE, Kuwait, Qatar and Oman and secured promises of reciprocal visits.

Zarif also expressed his intention to visit Saudi Arabia, but a date would be set only, “after consultations with our Saudi brothers.” Moreover, while visiting the Qatari capital of Doha, he told reporters, “[we] believe that Iran and Saudi Arabia should work together in order to promote peace and stability in the region… [The interim deal] cannot be at the expense of any country in the region.”

Iran’s adoption of an actively conciliatory foreign policy has set the stage for Iranian-Saudi cooperation and for further developments to take place. The question is whether Saudi Arabia is prepared to step up and play its role. The longevity of Iran’s new moderate and pragmatic approach to international affairs is contingent on its success. While hawks from all sides remain dubious of Iranian sincerity, the benefits of success are too high, and the risk of failure too grave to forego a truly historic opportunity.