End of the Islamic Cold War: the Saudi-Iranian Detente and its implications

Abstract

Saudi Arabia and Iran are not only reconciling their diplomatic differences, but are also cooperating in numerous areas including oil, trade, and domestic security. Given their differences, what forces are lessening tensions and motivating them to pursue this new detente? More importantly, what are the implications of this new relationship? Shifting political sands in Saudi Arabia and Iran in the late 90s, the failure of the US "Dual Containment" policy, and the collapse of the Middle East Peace Accords are bringing the two rivals together. It is, however, Saudi Arabia and Iran's dire economic conditions, worsened by the 1998-99 oil price collapse, that forces them to cooperate. The main vehicle for Saudi-Iranian cooperation is the Organization of Petroleum Exporting Countries. The Saudi-Iranian detente holds vast implications for oil and stability in the region. Their cooperation ensures higher oil prices, which adversely affect the world economy. These higher prices, however, salvage both countries' economies, improving their domestic stability. The reemergence of Iran onto the Gulf political landscape also serves to lessen tensions in the region. The resulting improvement in inter-Gulf relations creates possibilities for establishing a stable regional security framework that may affect the United States' role in the region.