The China-brokered deal between Iran and Saudi Arabia has shuffled the deck in the Middle East, cutting the US out of the pot.

Over the weekend, in a surprising development to most Middle East watchers, China brokered a deal between Iran and Saudi Arabia to restore some bilateral ties between the Islamic powers after seven years without them. The agreement was a very basic one, with the two countries agreeing in principle to exchange ambassadors within two months, reactivating a security cooperation agreement, and restoring some economic and cultural exchanges. This is the first formal rapprochement between the Islamic Republic and the Kingdom since 2016, when the Saudis executed a prominent Shia cleric, sparking violent protests at its embassy in Tehran and precipitating the break in relations. Since that split, the underlying conflict between the two states on either side of the Persian Gulf has rapidly escalated, with Iran taking the aggressive lead. Its proxies in Yemen, the Houthis, have attacked Riyadh directly, while Iran itself has launched cruise missiles at Saudi energy infrastructure, crippling a major refinery for weeks back in 2019.

Given this recent history, the fact that any kind of deal was struck shows that key changes are occurring in Middle Eastern politics. The agreement, basic as it was, did not force Iran to cease its aid of international terrorists or non-state proxies, even those which target the Kingdom; this was a conciliatory move on behalf of the Saudis towards the Iranians. This step towards normalization of relations without addressing some of the proverbial elephants in the room – the malign regional activities of Iran, the Shia-Sunni dispute, relations with Israel – fits well within the Chinese diplomatic playbook, as does the language of the agreement. In the text, both Iran and Saudi Arabia agree to the principles of “respect for the sovereignty of states and noninterference in their internal affairs,” a classic Chinese formulation that Beijing uses to ignore human rights abuses abroad and gloss over its own at home. There are a wide variety of implications and impacts from this diplomatic coup for China, both in the Middle East region and further afield.