Explained: How the deepening Gulf-Iran divide pushed Arab states towards US and Israel

The Gulf and Iran’s relationship

The Gulf Arab states’ troubled relations with Iran go beyond the ideological Shia-Sunni divide. The countries have viewed the growth of Tehran’s armed forces, its nuclear programme and alleged hegemonic tendencies as threats since the Islamic Revolution of 1979, which replaced the pro-West Pahlavi dynasty with an anti-American regime.

After its establishment, Iran’s Shia theocracy adopted a policy of “exporting” its revolution — a project that led to support for groups such as Hezbollah (in Lebanon) and Houthis (in Yemen), which have clashed with US and Gulf interests in the region.

The revolution itself inspired local Shia rebellions, most notably, the 1979 Qatif Uprising in Saudi Arabia.

Concerns about ideological subversion, sectarian mobilisation and regional instability posed by Ba’athism (in Iraq) and the revolution in Iran were among the factors that led to the creation of the Gulf Cooperation Council (GCC) in 1981, an intergovernmental organisation that has largely remained aligned with Washington for its security needs since the Gulf War (1991).

In a post-World War II world, the US-Saudi strategic partnership had been implicitly following an “oil-for-security” arrangement, wherein Washington provided security guarantees in exchange for stable global oil supplies from the major crude exporter. The ambit of this arrangement expanded to all six members of the GCC — Saudi Arabia, the UAE, Kuwait, Qatar, Oman and Bahrain.

In 2023, a China-brokered deal briefly restored diplomatic ties between Riyadh and Tehran. The Iranian attacks, however, have ensured that the divide is now wider than ever.

The role of Arab nationalism

In the 1990s, several Gulf states began diversifying beyond their status as hydrocarbon heavyweights to become hubs for tourism and investments.

The driving force behind this worldview was a change in perception of Arab nationalism in the Gulf – shifting from al-qawmiyya (pan-Arab nationalism) to al-wataniyya (land/state-based nationalism).

This major ideological reorientation could be partly attributed to the five major wars between the Arab world and Israel not yielding the desired results.

Moreover, pan-Arabism had become synonymous with Ba’athism — a brand of Arab nationalism that essentially undermined the monarchical systems in the Gulf and threatened to subsume their distinct Arab state identities.

The diminishing appeal for pan-Arabism in the richest section of the Arab world consequently affected its support for the Palestinian cause. The Palestine Liberation Organization (PLO) and its leader Yasser Arafat’s support for Saddam Hussein (who was leading Iraq’s Ba’athist regime) during the invasion of Kuwait dealt a major blow to Gulf-PLO relations.

Gulf ties with US and Israel

After the war with Iraq and in a post-Soviet unipolar world, the Gulf formalised defence ties with Washington, a security partner that would eventually act as an intermediary between the region and Israel. This would lay the groundwork for major initiatives in the years to come.

The US eventually became the GCC’s primary arms supplier, while the region shaped itself in tune with Washington’s strategic outlook. More US bases were built, encircling Iran and also in a manner that proved pivotal during the invasion of Iraq in 2003.

In the decades that followed, the Gulf witnessed the rise of bustling commercial enclaves, drawing investments in an array of sectors and migrant workers from the global south.

In the 2010s, several Gulf Arab states and Israel began stepping up cooperation unofficially, driven by shared concerns over the security threat posed by Iran. In 2020, the UAE and Bahrain became the first Arab countries to formally recognise Israel since Jordan in 1994 as part of the Abraham Accords. The Donald Trump administration has also been pushing for Saudi Arabia to join the accords, though the kingdom appears reluctant to enter a formal agreement citing concerns over Palestinian statehood.

The Gulf and Tel Aviv’s relations can be understood through Israeli Prime Minister Benjamin Netanyahu’s proposal in view of the recent Iranian strikes. He has suggested building oil and gas pipelines across the Arabian Peninsula to Israeli ports to bypass the Persian Gulf and Red Sea.

How Gulf states have responded to the war

The Gulf countries are unhappy with the US-Israeli war, which was launched despite their warnings and without them being notified. Iran’s retaliatory strikes have damaged their reputation as safe destinations for investment.

Their response to the war has also been varied. Oman, which mediated the US-Iran nuclear talks a day before the war began, has favoured diplomacy. So has Qatar, which has hosted Hamas leaders during talks.

For others such as Saudi Arabia and the UAE, the crisis could be an opportunity to significantly weaken Iran. The Saudis believe that ending the war won’t fetch a “good deal” and a settlement must include Iran abandoning its nuclear programme, ballistic missile capabilities, support for proxy groups and an assurance that the Strait of Hormuz will not be shut down.

The common anxiety, however, is that the US will unilaterally declare victory and withdraw from the war — leaving the Iran regime not only standing but maintaining a chokehold on the Strait of Hormuz.

What does this mean for Gulf-US ties?

Anxiety of this kind is not new. In 2019, the Houthis attacked Saudi oil facilities, temporarily knocking out half of the country’s oil output. In 2022, the group attacked the Abu Dhabi International Airport in the UAE. The lack of a concrete response from Washington caught the Gulf’s attention.

The coalition has since been hedging or diversifying its sources for its security needs. Saudi Arabia and Turkey are in the final stages of talks over co-production and technology transfer for the latter’s next-generation Kaan fighter jet program. Riyadh has also expanded cooperation with China for its nuclear programme. The UAE has tie-ups with South Korea for its own civil nuclear agreement.

However, this does not mean that the Gulf can or wants to decouple from the US. It has been projecting itself as an attractive investment destination, with American tech giants like Google and Amazon funnelling billions of dollars into its AI and cloud computing infrastructure. Iran’s drones have targeted these data centres as well.