US Approves Nuclear Deal with Saudi Arabia Amid Iran Tensions

At the end of February, the US administration and the Iranian regime were taking part in nuclear talks when Washington walked away from the negotiating table and launched a bombing campaign on Iran with Israel's Prime Minister Benjamin Netanyahu.

One of the many reasons given for US President Donald Trump's decision to go to war was to ensure the Iranian regime stopped enriching nuclear fuel.

But on Wednesday, Mr Trump formally approved a deal with a close ally that analysts warned could open the door for another Middle Eastern power to potentially do exactly that.

The US secretary of energy and Saudi Arabia's minister of energy signed an accord allowing the kingdom to build nuclear reactors using American technology and to enrich uranium.

"These two agreements lay the legal foundation for a decades-long, multi-billion-dollar partnership that advances several priority economic and strategic objectives, including nuclear non-proliferation," the US Department of Energy said in a statement.

The full details of the civil nuclear deal with Saudi Arabia are yet to be released, but US media has reported American companies will be given a central role in developing the state's new power reactors and other nuclear technology.

Westinghouse Electric is set to be one of the biggest winners from the arrangement, which will now go to US Congress for approval.

Saudi officials have long argued the kingdom needed an agreement to develop its nuclear industry and meet energy needs at home.

The accord has been years in the making, with talks spanning both Mr Trump's first administration and that of former president Joe ⁠Biden.

It had been the Biden administration's desire for the agreement to include a loftier outcome, that being Saudi diplomatic recognition of Israel, but that was abandoned after the October 7 Hamas attack.

To get the deal over the line with Crown Prince Mohammed bin Salman this time, US media is reporting that Mr Trump agreed to terms that may limit international inspectors from carrying out intrusive snap inspections of nuclear sites.

The Saudis may also be allowed to enrich uranium or reprocess plutonium on their soil, a stark contrast to the US deal signed with the United Arab Emirates in 2009 in which the UAE agreed to forgo producing nuclear fuel forever.

"Clearly this is meant to signal Iran that the US is willing to basically allow its allies and partners in the region and the Gulf side to gain a nuclear capability … should it [Iran] choose to try and seek a nuclear weapons capability," said Mona Yacoubian, director and senior adviser of the Middle East Program at the Center for Strategic and International Studies.

The controversial deal will bring the United States closer to the Saudi government at a perilous time in the two sides' relationship.

But analysts warn it has the potential to spark "a nuclear arms race in the Middle East".

A testy time for US and Saudi Arabia

For many years, Saudi Crown Prince Mohammed bin Salman was a pariah on the world stage, but since returning to the White House, Mr Trump has worked to bring him back into the fold.

In May last year, the US president flew to the wealthy Gulf Arab state on one of his first major foreign trips abroad and was personally welcomed by the crown prince after he touched down in Riyadh.

Mr Trump then returned the favour in November when Prince bin Salman visited the White House, personally greeting him on a red carpet outside the historic building and offering a tour of the presidential mansion.

Mr Trump also has a personal connection to the country through his son-in-law, Jared Kushner, a businessman with strong ties to the crown prince who benefited from a billion-dollar investment from a fund led by the Saudi leader four years ago.

But America's war in Iran has tested the US–Saudi relationship at various points in the last few months and brought its leaders close to dispute.

During the conflict, as the Iranian regime has sought to broaden the impact of the war throughout the region, Tehran has targeted US bases in Saudi Arabia and disrupted its energy exports.

The Saudis have been left grappling with how to contain the fallout of a war they did not ask for, and as they sought reassurances from the Trump administration, they have reportedly come to see the US government as unreliable.

More recently, as the US and Tehran inked a memorandum of understanding and worked towards a peace deal, Saudi Arabia has been moving to strengthen ties with other nations in what appeared to be a sign the kingdom could no longer rely only on the US.

But some of those relationships had the potential to be a thorn in Washington's side.

Nuclear deal will 'deny Russia and China' influence

This deal may go some way to repairing the damage the Iran war wrought on US ties, allowing Washington to keep its key ally on side and within its strategic sphere of interest.

"The agreement could … strengthen US-Saudi ties, and deny Russia and China a strategically important role in the Saudi nuclear program," Robert Einhorn, a former longtime senior State Department official who advised both Republican and Democratic administrations on nonproliferation issues, told the Wall Street Journal.

For some time now, Chinese and Russian state-owned enterprises have been looking to fill the nuclear supply vacuum left by the exit of Western vendors.

And Saudi Arabia presented a lucrative market.

In 2016, China signed a deal to "invest $US2.43 billion [$3.46 billion] to build a nuclear manufacturing equipment industrial cluster in Saudi Arabia", while Russia had made an offer to build nuclear reactors in the country.

Saudi Arabia had also said if it did not partner with the US, it could partner with China or Russia.

The growing interest from these two superpowers had led analysts from the Carnegie Institute to warn that if Washington "cedes the nuclear supply game at this early stage of development in Saudi Arabia, Moscow or Beijing will become the primary stewards of Riyadh's nuclear ambitions".

Yet with this new deal, Washington has had the final word, for now.

"If you do a deal the right way, you actually reinforce non-proliferation standards by requiring transparency and by requiring that availability to inspection," said John Erath, senior policy director at the Center for Arms Control and Non-Proliferation.

"You are setting the high standards for a civilian nuclear power throughout the world.

"If done right this is a very good thing. If done wrong it could lead to proliferation."

There is also a significant commercial interest to the deal, because American firms are going to make a lot of money out of it.

"We are talking about billions of dollars here that would go towards US business," Mr Erath said.

Mr Trump values a good deal, especially if it brings in a lot of money, but his opponents argue that the flow of cash into American coffers may come at a steep cost.

A 'signal' to Iran

Critics of the new pact argue it does not include the typical American "gold standard" that would bar Saudi Arabia from enriching uranium and processing spent atomic fuel — both possible pathways to making material for a warhead.

"They are allowing Saudi Arabia, a belligerent and authoritarian nation, to develop nuclear weapons technologies while starting a war with Iran under the guise of preventing an Iranian nuclear bomb," said Democratic senator Edward Markey.

The deal also reportedly fails to include an "additional protocol" of extra international oversight of relevant nuclear facilities from the IAEA.

"The government of Saudi Arabia has indicated it is unwilling to sign an additional protocol, so without that, how do we meet the high standards of non-proliferation?" Mr Erath asked.

"That is really going to be the question people will ask about this deal when the details become known and what will receive the most scrutiny."

The accord is set to go to US Congress for approval and Mr Erath has warned members are going to want to know how nuclear assurances are being provided, if not through an additional protocol.

"The assurances and the transparency measures would be to ensure that Saudi Arabia is not enriching uranium to weapons usable levels," he added.

Analysts said the deal has also raised questions over US foreign policy coherence since Mr Trump's argument for going to war was partly fuelled by Tehran's refusal to give up an enrichment program.

"I think [the deal] will actually serve as a further provocation from the Iranian side," said Ms Yacoubian.

She suggested the deal could also be a signal that Mr Trump accepted the US war with Tehran would be a long conflict.

"I would give you even a darker potential reading: the US in essence acquiescing to the possibility that Iran may indeed pursue a nuclear weapon, or a nuclear weapons capacity, and then we see the beginning of a nuclear arms race in the Middle East, which would be an extraordinarily dangerous development," she said.

Mr Erath said he believed the timing of the Saudi agreement was tied to the war in Iran and the current discussions around a potential peace deal.

"I suspect that there is some sort of parallel that is going on with the talks with Iran right now," he said.

Mr Erath explained that Saudi Arabia may have insisted on having the "same status" on the issue of nuclear facilities as Iran may get under a potential peace deal with the US.

"I can see the two things proceeding in parallel and equalling each other in that respect," he said.

Regardless of a US-Iran deal, the Saudis have managed to secure a nuclear power deal that goes much further than some expected.