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Significance

The restoration of diplomatic relations ends a seven-year period of intense competition between the two countries. The deal is a diplomatic agreement and does not address the root cause of the previous tension: the longstanding claim for leadership of the Islamic world.

Impacts

Saudi Arabia will play a more active diplomatic role as a mediator in the region.

Saudi Arabia will engage politically in Lebanon following a seven-year hiatus.

Bahrain and the UAE could purchase Israel’s advanced air defence systems to offset the threat from Iran’s ballistic missile capabilities.

Saudi Arabia’s decision whether to normalise with Israel will not be directly impacted by the restoration of diplomatic ties with Iran.

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