Can the Saudi-Iranian deal help resolve the conflict in Yemen?

Predicting whether the Saudi-Iranian agreement will end the crisis in Yemen is difficult. The reconciliation between the two nations is expected to reduce direct escalation with Saudi Arabia, but it is unlikely that the Iran-backed Houthis will halt their drone and missile attacks on Saudi Arabia.

The deal will certainly not change Iran's long-standing policy of supporting proxy groups in the region to advance its agenda.

Read more: Will the Saudi-Iran deal reshuffle the regional security deck?

Positive signs, but caution encouraged

Since the reconciliation attempt, there have been positive signs emerging in some of embattled areas of Yemen. But this is best viewed as a temporary lull where Iran is looking to calm fighting to give some breathing room for the fairly recent Saudi-Iranian agreement to take hold.

It is dangerous to view this lull as a sign that Iran is abandoning its support of such a critical power tool in southern Arabia. As such, the complex situation in Yemen is likely to continue.

For Iran, Yemen will remain a strategic, low-cost corridor, ensuring its operational access to vital areas across the Arabian Peninsula during any potential future conflict.

Observers on both sides tend to overlook the significant shift in Iran's strategic perceptions and policies. It no longer views Saudi Arabia as mere follower of US policy in the region. Rather, it has become a formidable military threat that can challenge Iran's ability to develop weapons or establish military bases in the region.

Iran has sought to enhance its military capabilities not only in Yemen but also near the Gulf coasts to ensure an advantageous position should any confrontation with countries on the Arabian Peninsula present itself in the future.

Therefore, it is unlikely Iran will change its strategy — especially since reconciliation between the two regional powers is still in its early stages. On the contrary, both states are likely to boost their capabilities and jockey for power to improve their negotiating positions. 

Both countries will continue their policy of deterrence and containment, albeit in different forms. Saudi Arabia will rely on its economic influence, while Iran will rely on its military proxies, including the Houthis in Yemen.

However, diplomatic relations between countries with a shared strategy of deterrence and containment can coexist despite generational tension, as seen in the United States' diplomatic relationships with Russia and China.

Opportunity to build trust

The Saudi-Iranian deal is an opportunity to build trust between the two countries until it leads to a favourable regional climate that will have positive knock-on effects in Yemen and other troubled states.

The reestablishing of relations was a necessary first step, but a transition toward a peaceful and cooperative relationship will be a gradual process. At this critical stage, it is important to capitalise on the current positive momentum and find ways to protect Yemen from future setbacks.

Success is inherently linked to two factors: reining in Iran's support for the Houthis and ensuring regional balance between Riyadh and Tehran.

Opportunities and risks

Iran and Saudi Arabia are naturally driven by their own unique motives — both come with their own unique set of opportunities and risks.

While inherently driven by self-interest, the deal has the potential to secure opportunities for cooperation where there is common interest, which could lay the groundwork for a more sustainable reconciliation.  

However, the risk remains that either party could renege on the deal should they find their intended goals are not being met or realised. This would certainly lead to a resumption of fighting in Yemen.

From the Saudi perspective, the deal helped move the two countries away from costly military competition, focusing on economic competition instead. With this aim, Riyadh has implemented a three-fold strategy:

• Calming hostilities with Iran
• Maintaining its security relationship with the United States
• Diversifying and enhancing its military capabilities

This multi-pronged strategy, along with diplomatic engagement with Iran to establish deterrence through diplomacy and bring in a new political mediator, namely China, provides a favourable environment to foster reconciliation in Yemen and put an end to its ongoing civil war.

Success will depend on the commitment of all parties involved to work toward a peaceful and fair resolution that benefits everyone. Although Riyadh and Tehran have different motivations, the potential benefits of their agreement outweigh the risks.

Can this approach work? Can Saudi Arabia persuade Iran to reach a political solution in Yemen while Tehran maintains its relationship with the Houthis?

On its part, Iran — reading the situation and reality on the ground — has realised that Saudi Arabia has no interest in war in the Gulf region.

The failure of the American maximum pressure policy on Iran, Tehran's determination to increase uranium enrichment, and Israel's threats to strike Iranian nuclear facilities have placed the region on the brink of war.

Read more: Is Israel on 'red alert' yet?

Saudi Arabia does not want any part in this escalation, which undermines its security and delays its social and economic transformation project. Saudi Arabia's recent openness with Iran sends a clear message that the Kingdom is not willing to risk direct war with its hostile neighbour.

This has alleviated Iranian concerns about any Saudi participation or cooperation — whether with Israel or the US — to target Iran.

Saudi concerns and objectives

Saudi Arabia's main concern regarding Iran is its direct support for Iranian-backed groups in Yemen and the destructive impact of Iranian intervention in Yemen and the surrounding areas.

Additionally, Saudi Arabia is concerned about Iran's advanced missile programme that has been found in the hands of its proxy groups around the region.

This concern is not being addressed in talks between the United States and its European partners with Iran. This is one of the main factors that drove Riyadh to reach a regional deal with Tehran.

While Saudi Arabia is under no illusion that Iran will scale back on its missile programme, it believes that normalising relations with Iran is a necessary step to help foster stability in the region — especially in Yemen.

Iran may also benefit from Saudi Arabia's social and economic transformation programme, where Tehran eyes opportunities. But realising such opportunities is largely dependent on the stability of the region.

On its part, Saudi Arabia has demonstrated its commitment to protect this delicate balance. For example, it has remained neutral in the conflict in Ukraine, which helped protect it from the negative repercussions of Russian-Western tensions.

The ultimate goal is to achieve peace and stability in the region, and Saudi Arabia is willing to engage in constructive dialogue with Iran to achieve this.

China's mediating role

A potential factor that could support greater stability and sustainability in Yemen is the Saudi-Chinese economic, security, and strategic partnership. Beijing's mediation played a crucial role in achieving a breakthrough towards peace, enabling Riyadh and Tehran to reach the deal.

Read more: Why China is mediating in the Middle East

Given China's political and economic influence over Iran, its role is expected to increase in this process, making Iran more inclined to fulfill its commitments in the agreement with the Kingdom — particularly in Yemen, which is a key commitment area.

Iran sees China's intervention in Gulf security issues as an opportunity to expel America from the region. Carrying out multilateral diplomatic initiatives without the presence of the West is one of Iran's strategic objectives. Tehran wants to pull China into Gulf security affairs as part of this process.

The naval exercises with China and Russia are examples of this process, which Tehran believes can contribute to enhancing China's presence and limiting America's capabilities in the region. Saudi Arabia does not necessary view this as a negative thing, which sees that it could potentially bring greater stability to the Arabian Peninsula and Yemen.

The bigger picture

Stability in the region — especially along the long border with Yemen — is essential for Saudi Arabia.

The Kingdom did not sign the agreement with Iran without justifiable reasons and a practical plan that it would benefit from. Riyadh realises that ending the zero-sum game with Iran will have positive repercussions in the region — many of which may not be part of Iran's calculations and may go beyond Yemen or even outside Iran's control. 

In other words, Iran sees the deal with Saudi Arabia as a means of consolidating its gains in Yemen, Syria, Iraq, and Lebanon, where it wields significant influence. From Iran's perspective, neutralising Saudi Arabia will help maintain the status quo in these places and further its interests.

Restoring diplomatic relations between Saudi Arabia and Syria, for example, could pave the way for other Arab nations to reconcile with Damascus. While this could allow Riyadh to exert its influence in these regions, it would also reduce implicit support for opposition groups to Syrian President Bashar al-Assad.

Read more: After diplomatic breakthrough with Tehran, Riyadh sets its sights on Damascus

Iran also believes that this new dynamic will stabilise its regional partners in Yemen in the long run and welcomes it. Despite American presence, Tehran has maintained its influence in Iraq and is confident that Saudi Arabia's soft entry into Syria or Houthi-controlled areas in Yemen will not strategically jeopardise its interests.

However, this perception may not be entirely accurate.

The opening of previously closed areas to Saudi Arabia could provide unprecedented opportunities to positively change the balance of power in these regions, where Iranian influence has been strengthened by their closure and lack of openness to other options besides Iran.

Military advantage not guaranteed

Moreover, the forces associated with Iran in Yemen or elsewhere are not a monolithic group, as they contain elements that understand the long-term consequences of hostile actions by their neighbours and extremist elements closely linked to Iran.

While these groups benefit from Iran's superiority in drones and high-tech missiles, they realise they cannot maintain this advantage forever.

Saudi Arabia is developing its own missile and drone technologies with Chinese assistance and improving its anti-drone missile defence capabilities with the help of the United States, Europe, and other partners.  

It is in the interest of the Houthi movement to negotiate on a realistic roadmap for the future of Yemen and reach an agreement with the Kingdom before its relative advantage in cheap drones and low-cost missiles ends.

Despite the agreement, Iran will view Saudi Arabia's military development programmes as a threat to the regional defence balance, and efforts will continue to launch appropriate countermeasures — especially in Yemen.

While Iran may temporarily agree to limit the supply of new and advanced offensive weapon systems to the Houthis, it will not stop supporting them as a deterrence pillar as long as it lacks quality alternatives in its army.

Given the constant and increasing threat from the US and Israel, Tehran will continue its policy of qualitative improvement of the operational capability of the so-called Axis of Resistance, including developing horizontal operational links between armed Shiite groups in the region from Yemen to the Fertile Crescent and increasing their coordination and inter-operational capabilities.

The Saudi-Iranian agreement will not solve the conflict in Yemen on its own, but Iran's role is essential in making progress toward this goal. Internal factors play a crucial role in determining the success of such reconciliation attempts.

However, the Saudi-Iranian agreement has presented a historic opportunity to change the security structure of the Gulf region in a way that serves the interests of both Saudi Arabia and Yemen.