Inside the Saudi-U.S. Rift

U.S. President Barack Obama shakes hands with Saudi Arabia's King Salman at the start of a bilateral meeting at Erga Palace in Riyadh January 27, 2015. Jim Bourg/Reuters

Updated | It was a symbolic Saudi flourish, meant to lighten the mood. As President Barack Obama and King Salman finished dinner at the royal palace in Riyadh recently, an aide to the monarch prepared a separate room where the two leaders would sit and discuss Middle East policy. Holding a silver diffuser, the aide walked through the gold-colored meeting hall—past framed portraits of Saudi monarchs and beneath enormous crystal chandeliers—letting the smell of incense waft throughout the room. Soon, Obama and Salman entered and debated a variety of issues, from the rise of the Islamic State (ISIS) and the recent turmoil in Yemen, to falling oil prices and Saudi's abysmal record on human rights. But the incense apparently wasn't enough to mask the bitterness between the two allies. After the hour-long discussion, one American official, who wasn't authorized to speak on the record, betrayed a hint of concern, saying: "We're going to continue to have to stay in very close touch."

For years, even when Washington and Riyadh bickered over Middle East policy, the relationship never seemed dangerously strained. The two sides have frequently clashed over Israeli settlements in the West Bank, a solution to the Syrian Civil War and Washington's efforts to ink a nuclear deal with Riyadh's rival, Iran. But what held the alliance together, most assumed, was an immutable mutual dependence: The U.S. needed Saudi oil, and the kingdom needed American security.

Today, that line of reasoning appears passé. Deep differences over Middle East policy—not to mention a sharp reduction in U.S. dependence on Saudi oil—have whittled down a once-expansive U.S.-Saudi alliance. Not only do Washington and Riyadh have profound disagreements about Syria, the Palestinians and Iran, but over the past few years, the Saudis have also been charting their own foreign policy path, coordinating with the U.S. only when it serves their interests. Salman, the kingdom's new monarch, is expected to continue this policy, which began under his predecessor, King Abdullah, who died last month. "The main question now," says Charles W. Freeman Jr., a former U.S. ambassador to Saudi Arabia. "is what's in it for them [the Saudis]."

The kingdom's embrace of realpolitik marks a major departure from the days when U.S. and Saudi leaders brimmed with good will and the two sides had overlapping interests. Since the end of World War II, when President Franklin Roosevelt met King Abdel Aziz ibn Saud on a U.S. Navy destroyer in the Suez Canal, the relationship has centered on the exchange of Saudi oil for American protection. The friendship between the two countries deepened during the Cold War, when they collaborated against Soviet-backed Egyptian forces in Yemen's civil war in the 1960s and later conspired to arm the Afghan mujahedeen against the Soviets in the 1980s. Before the Iranians got involved, it was Saudi money that allowed President Ronald Reagan's aides to skirt a congressional ban on funding anti-Communist rebels in Nicaragua. In 1990, the Saudis allowed some 500,000 American troops to be stationed inside their borders in preparation for the first Iraq War. And while the Saudis, enraged over U.S. support for Israel, rattled Washington with its oil embargo in the 1970s, in the ensuing years, Riyadh not only lifted the sanctions but regularly increased production at the White House's request when rising crude prices threatened the U.S. economy.

But the relationship suffered a devastating blow when it turned out that most of the 9/11 hijackers were Saudis. Despite the sworn enmity between Al-Qaeda and the Saudi royal family, some Americans still suspect official Saudi support for the terrorists. The skepticism was mutual. When the U.S. invaded Iraq in 2003, Riyadh lost confidence in American security guarantees. Iran, King Abdullah feared, would emerge as the true winner of the war, and as the conflict carried on, the king's prediction came true. In response, Saudi Arabia eliminated its subsidy for transporting oil to the North American market. Within months, China became the kingdom's chief customer. "They downgraded us," Freeman said. "We were a very acceptable and desirable security partner so long as we had no imperial agenda of our own in the region."

President George W. Bush wasn't the only American leader to disappoint the Saudis. In 2013, after calling Syria's use of chemical weapons a "red line," Obama backed away from his threat of military force, raising serious question in Riyadh and elsewhere about the president's resolve and credibility. During Obama's time in office, the Saudis have also been frustrated that the White House didn't push harder for an Israeli-Palestinian peace plan put forward by King Abdullah. "We're no longer the partner we once were," Freeman said. "The Saudis don't think they owe us very much of anything."

As a result, the Saudis have shown they're willing to fund their friends—even when it goes against American priorities. When the Arab Spring erupted in 2011, Riyadh was furious with Obama for failing to support Egypt's embattled strongman, Hosni Mubarak, a longtime American ally. The kingdom's anger only intensified when the Obama administration embraced Mubarak's elected successor, Mohammed Morsi, the leader of Muslim Brotherhood, a banned group in Saudi Arabia. When Egyptian General Abdel-Fattah el-Sissi overthrew Morsi last July, Riyadh lavished him with $12 billion in unconditional aid. That money made it easier for el-Sissi to ignore the White House when it pressed Cairo on human rights concerns.

Another change in the relationship involves U.S. overflight rights. Saudi authorities used to grant the U.S. military aircraft near-blanket permission to pass through Saudi territory on their way to East Asia. Now, says one U.S. official who spoke to Newsweek on the condition of anonymity, "they periodically withdraw permission to remind us it's their airspace." This forces American planes to add hours and thousands of miles to their flights as they weave around the Arabian Peninsula.

Saudi Arabia's newfound independence also extends to trade. In recent years, Riyadh has tried to diversify its commercial relations. In 2013, U.S. exports to Saudi Arabia totaled $19 billion, down from $25 billion in 2012, according to the office of the U.S. Trade Representative. A report from the Economist Intelligence Unit attributed some of the decline to Saudi's shift away from big American-made gas-guzzlers to cheaper Chinese cars. Some Americans see a bright spot in the decision by Saudi Arabia—the world's largest oil exporter—to maintain production levels in the face of falling oil prices. But ultimately the Saudis are not doing the United States any favors. Riyadh, which can fall back on its enormous cash reserves, not only wants to see low prices punish rivals Iran and Russia for their support of Syria; it also wants to cripple competition from America's shale oil industry.

The one area where U.S.-Saudi cooperation is still flourishing is counterterrorism. When Obama launched the first sorties in a bombing campaign against ISIS militants in Iraq and Syria, Saudi Arabia scrambled to join the airstrikes. The kingdom is also hosting a training camp for Syrian rebels and a small base for U.S. drones. Intelligence sharing has never been stronger, and Riyadh continues to buy billions of dollars' worth of U.S. military hardware.

It's unclear how this counterterrorism cooperation will affect other aspects of the U.S.-Saudi relationship. Salman is close to his country's religious establishment, which largely reflects the views of the desert kingdom's 30 million people; most are ultraconservative Muslims whose sympathies lie more with ISIS than with the United States. As the king weighs closer ties with the U.S., he can no more afford to ignore the sensitivities of his subjects than, say the governors of Alabama and Texas can afford to dismiss the beliefs of their states' devout evangelical Christians.

In the meantime, fresh challenges await. In January, a coup in neighboring Yemen toppled the pro-U.S., Saudi-backed government. Now, gunmen loyal to the Shiite Houthi movement are in power, and because they're allegedly close to Iran, Saudi Arabia feels caught in a pincer. At the same time, the U.S. is concerned that the turmoil will distract the country's security forces, taking pressure off Yemen's Al-Qaeda affiliate. In recent weeks, Washington has moved to ensure it can continue its drone campaign against the group, reportedly establishing ties with the Houthis through intermediaries. "That would be one way of stabilizing Yemen," Bernard Heykal, a Middle East expert at Princeton, told NPR. Maybe, but with growing distrust between the White House and the house of Saud, King Salman might conclude that it's he, not the incense, who's been burned.