Saudi Arabia has spent five months keeping communication channels open with Iran and avoiding getting drawn into a regional conflict, even as Iranian drones have targeted the country’s oil industry.
Currently, Iran appears to be boxed in, facing a three-pronged enemy: Iran and its proxies, Iraq and Yemen.
In the past week, Saudi Arabia has faced missile attacks by the Iranian-backed Houthis in Yemen, drone attacks by pro-Iranian militias in Iraq, and new threats from the Iranian government.
Early Tuesday morning local time, it became clear that restraint was no longer an option, as fighter jets and U.S. military aircraft struck across eastern Iraq.
But the stakes are high.
For Riyadh, becoming embroiled in a broader conflict would be a risky and potentially costly option. Over the past decade, the focus has been on opening the country to foreign investment and turning it into a regional economic power. This led to a policy of easing tensions with Iran even before the war, leading to an agreement mediated by China in 2023.
That strategy is currently on life support as Saudi Arabia is caught in the middle of a storm. Confronting an unpredictable enemy adept at three-pronged asymmetric warfare is a nightmare for military planners.
Saudi Arabia has spent tens of billions of dollars modernizing its military and purchasing state-of-the-art missile defense equipment, but it has a vast territory (about one-fifth the size of the United States) and a coastline to defend, and its oil infrastructure is widely dispersed.
Over the weekend, the Houthis fired missiles at two Saudi oil complexes on the Red Sea coast. Satellite imagery and geolocation video suggest extensive damage to one of these facilities in Jazan, near the border with Yemen.
The missile attack followed attacks on two Saudi tankers in the Red Sea after the Houthis announced a blockade of Saudi ships passing through the Bab al-Mandeb chokepoint. The Houthis on Monday claimed further attacks on Saudi ships.
The blockade marks a major escalation for Saudi Arabia, which has diverted much of its oil exports through Red Sea ports such as Yanbu as Hormuz remains paralyzed.
They plan to further expand oil exports via the Red Sea, to around 9 million barrels per day over the next three years. But tankers leaving Yanbu bound for Asian markets will have to pass through Bab al-Mandeb, exposing about three-quarters of exports via the Red Sea to Houthi disruption, analysts say.
Saudi Arabia has spent seven years unsuccessfully trying to remove the Houthis from northern Yemen, launching a major offensive against the militants in 2015. The ensuing conflict caused one of the world’s worst humanitarian crises.
A ceasefire agreement was signed in 2022, but it did not lead to peace. Saudi Arabia maintained an economic and air blockade of Houthi-held areas.
Earlier this month, the Houthis accused Saudi Arabia of bombing the airport in the capital Sanaa to prevent a direct flight from Tehran from landing, ignoring warnings to turn around.
The plane was carrying a Houthi delegation returning from the funeral of Iran’s former supreme leader Ali Khamenei. But “there was also a lot of attention to what could have been carried on board the plane,” said Nawaf Obeid, a professor of war studies at King’s College London.
That set off a new cycle of violence, culminating in a missile attack over the weekend.
“All the red lines have been crossed and all the (Saudi) buttons have been pushed (by the Houthis),” said analyst Mohammed al-Basha.
A large force of Yemeni fighters opposed to the Houthis is gathering in Yemen’s eastern desert, regional sources told CNN on Monday. If it goes ahead, it will receive support from the Saudi air force, including Apache attack helicopters.
But for now, analysts say Saudi Arabia’s response is likely to be an airstrike. On Friday, the Saudi air force targeted the port of Hodeidah, the largest port under Houthi control, in retaliation for the tanker attack.
Obeid said the Saudi air force is far better able to detect, track and attack distributed military threats than it was a decade ago. The system has been integrated in a way that “drastically reduces the time from detection to response.”
However, there is also the possibility that the Houthis could be taken over. They have frequently demanded cash in return for the huge salaries of civil servants and militiamen.
“The Houthis appear to be following North Korea’s strategy, using repeated cycles of provocation to extract political and economic concessions… turning Saudi Arabia and territory south of the Red Sea into their arena,” Basha said.
It remains unclear whether they will turn their backs on Iranian patrons for Saudi cash.
In a palm forest in southern Iraq, pro-Iranian militias fired two rounds of drone barrage on Monday and Tuesday, targeting critical Saudi infrastructure and the capital Riyadh, the Saudi Ministry of Defense said. Analysts say the Houthis may have provided technical assistance to these militias.
Riyadh’s patience is running out. And early Tuesday, the Defense Ministry said it “conducted precise and targeted strikes” against militia groups in eastern Iraq “in connection with attacks on Saudi oil facilities.”
A new red line has appeared. “Saudi Arabia does not seek escalation, but emphasizes that it will respond to any aggression it faces,” the ministry added.
The Popular Mobilization Forces, an umbrella organization for paramilitary groups, said the airstrike killed and injured “a large number of people.”
U.S. Central Command (CENTCOM) said the joint operation was a “strong response” to more than 30 drone strikes allegedly directed by Iran’s Islamic Revolutionary Guard Corps.
Hundreds of drones were launched from Iraq toward U.S. military facilities in Saudi Arabia in the first weeks of the war, Centcom said. Despite the ceasefire in the conflict, several more ceasefires followed in May.
Saudi officials will not forget the precise and devastating attack on the Abqaiq refinery in 2019 that took out almost half of Saudi Arabia’s oil production.
Although the Houthis claimed the attack, sources told CNN at the time that the attack likely originated from Iraq. At the time, Saudi Arabia chose not to retaliate, but blamed Iran for the attack.
In March and April, Iranian Shahid drones targeted oil facilities on the kingdom’s east coast, prompting Saudi authorities to rush to invest in counter-drone technology. Ukrainian President Volodymyr Zelenskiy visited Riyadh and offered an integrated defense system to protect against Iranian drone swarms.
However, such equipment is not installed overnight. Saudi Arabia continues to face the dual threat of Iranian drones and short-range ballistic missiles from across the Gulf.
Although Iran has not directly targeted Saudi Arabia since April, the Foreign Ministry reiterated this week that “some countries in the Persian Gulf independently took part in military attacks against Iran. The United States bears responsibility for the attack, but the role of some regional countries cannot be ignored.”
Diplomats familiar with the situation said Saudi Arabia carried out several airstrikes against Iran early in the conflict, but they were carefully calibrated.
The diplomat told CNN in May that it was a proportionate response aimed at showing Saudi Arabia could protect itself “even without the United States.”
If Saudi Arabia were again exposed to Iranian missile or drone attacks, it could face an unacceptable choice. Either they respond directly by drawing them deeper into the war, or they turn around and embolden the regime in Tehran, which many see as more hardline than it was before the war.
Saudi Arabia is already facing significant economic damage from the conflict. The country posted its biggest quarterly deficit since 2018 in the first three months of the year as it increased spending to offset the effects of war and economic downturn.
The deficit has been partially offset by increased revenues from more expensive oil, but further disruptions to oil production and exports would put it at risk. Many of Saudi Arabia’s biggest projects have already been scaled back.
After all, Saudi Arabia is in the middle of a region that looks even more threatening and unstable than it did on February 28, when the war began.
Saudi officials are surprised by US President Donald Trump’s whiplash style of Iran-Gaza policy.
Cooperation between the Saudi and U.S. militaries remains close, but there are growing concerns in Riyadh that a waning U.S. interest could leave it alone facing a more belligerent and assertive Iran.
The kingdom and its allies are at a crossroads. It doesn’t help that Saudi Arabia and the United Arab Emirates are just beginning to mend relations damaged by the UAE’s abrupt exit from the OPEC oil cartel, disagreements over the conflict with Iran, and conflicts over who to support against Yemen’s Houthis.
It is clear that Saudi Arabia has now decided that there is a limit to the amount of punishment it can absorb before striking back.
