Hamas attack has abruptly altered the picture for Middle East diplomacy

Iran wants to make it impossible for Saudi Arabia to strike deal with Israel, while others in region cannot afford mayhem in Gaza

As the death toll rises, and the security consequences multiply, Israel is pointing its finger of accusation at Tehran for orchestrating the attacks by Hamas. The attacks may have been born of anger, specifically at the months-long behaviour of the Netanyahu coalition, including the provocations at al-Aqsa mosque, but Iran and the forces it supports have a longer-term strategic goal: to thwart the US-led effort to achieve a normalisation of relations between Saudi Arabia and Israel, a move that would entrench the US in the Middle East – and in Iran’s eyes deprive the Palestinians of their last influential sponsor.

Iran’s goal is to denormalise the region, and make it near-impossible for Saudi Arabia to strike a deal. Israel, by contrast, wants to shrink the Palestinian conflict diplomatically so it gradually becomes an irrelevance, a historical curio such as the Yom Kippur war. The aid it drip-feeds to Gaza via Qatar is one leg of this strategy.

In a speech earlier this week, Iran’s supreme leader, Ayatollah Ali Khamenei, sent a thinly coded warning to Riyadh that any Gulf state that backed the US was backing the wrong horse. “The definitive stance of the Islamic Republic is that the governments which prioritise the gamble of normalisation with the Zionist regime will incur losses,” he said in remarks carried by Iran’s state-run and semi-official media. “As the Europeans say, they are betting on a losing horse. Today, the situation of the Zionist regime is not one that should motivate closeness to it; they shouldn’t make this mistake.”

He was joined on Friday by the head of Islamic Jihad, Ziad al-Nakhala, who said: “Those who rush towards normalisation with the Zionist project must know, and they do know, that this is their acknowledgment that Palestine is not ours, and that Jerusalem with its mosque is not ours.”

Saudi Arabia, its economy expected to shrink this year according to the World Bank due to oil production cutbacks, has been desperate for foreign investment and craves Israel’s technological dynamism. The United Arab Emirates’ trade with Israel doubled to $2.56bn in 2022 after striking a free trade deal with the country. But Riyadh, now a member of the growing transactional diplomatic tendency, also wants new US defence guarantees, similar if not better to those given to Bahrain in September, and access to civilian nuclear power. It also needs something tangible about the restart of Israeli-Palestinians talks. Antony Blinken, the US secretary of state, was due to discuss all this with Crown Prince Mohammed bin Salman in a regional tour next week.

Now with the start of what could become a regional war, the risk calculations have changed. Hamas has shown its firepower and extended its base beyond Gaza. Far from the conflict shrinking it has been broadened. Riyadh’s initial response to the Hamas assault, a group with which it has few contacts, was the first critical clue of how Riyadh viewed the diplomatic consequences. It was not encouraging for Israel, and nor, given the inflamed passions, could it afford to be.

The Saudi Arabian ministry of foreign affairs noted the unprecedented situation between certain Palestinian factions and the occupation forces and called for restraint on all sides. But it then recalled “its repeated warnings of the dangers of the explosion of the situation as a result of the continued occupation, the deprivation of the Palestinian people of their legitimate rights and the repetition of the systematic provocations against its sanctities [holy sites]”. It urged the international community to restart a credible peace process based on a two-state solution.

Qatar was even less equivocal, saying Israel was “solely responsible for the ongoing escalation due to its continuous violations of the rights of the Palestinian people, including the recent repeated incursions into the al-Aqsa Mosque under the protection of the Israeli police”.

Since then, the Saudi foreign minister has been speaking with Blinken, the EU high representative, Josep Borrell, and every counterpart in the Gulf. The fruits of those talks will be reflected when the UN security council meets in emergency session and hears repeated calls for restraint. But many diplomats privately acknowledge they are paying a price for allowing the Middle East crisis slip to the back of their agenda.

The real diplomatic work will be done in private. In the short term, Turkey and Egypt will act as the mediators. Egypt, itself facing elections in two months, cannot afford mayhem in Gaza. The initial Hamas aim will be to make Israel think twice about the scale of its retribution. The Hamas al-Qassam brigades spokesperson Abu Ubaida said: “The number of [Israeli] prisoners is many times greater than what Benjamin Netanyahu announced, and they are present in all axes in the Gaza Strip, and what happens to the people of the Gaza Strip will happen to them, and beware of miscalculation.”

Hezbollah has also sent a message via Egypt to Israel about the potential consequences of a full-blown assault on Gaza. The US for its part is urging Israel to de-escalate, hold off on a ground assault and rely on measures such as cutting the supply of Gaza’s electricity to force Hamas to negotiate. Inside Israel there are also voices calling for calm, saying that after such a security lapse a unity government is required that will allow Netanyahu to end his disastrous reliance on extremists to stay in power. With the lives of so many hostages at stake, retribution will have to be carefully calibrated.

Netanyahu’s political survival skills are well-known, but it will be hard to avoid blame for such a self-evident intelligence fiasco. Golda Meir was gone as prime minister within six months of the Yom Kippur war, giving way to Menachem Begin and eventually the Camp David agreement with Egypt’s Anwar Sadat in 1978. Right now, it is hard to envisage a repeat of such an optimistic chain of events.