(This was written for the European Council on Foreign Relations, appearing on its website)

Almost everyone is happy about the deal reached between United States and Iran. Turkey, which has been drawing close to Tehran of late, is sending its foreign minister there on Monday; Oman was the location secret U.S.-Iran talks in recent months, so must be happy; the UAE issued a statement welcoming the deal. The two naysayers were always Israel and Saudi Arabia. Israel has made plain its displeasure, while Saudi Arabia has maintained a royal silence.

It’s quite a blow. Firstly, Saudi Arabia failed to get the United States to attack Syria for it. After months of feverish activity by Prince Bandar and his team to boost the Syrian rebels, with ambitious plans for a rebel army to start up in north Jordan, the golden moment appeared to have arrived when hundreds of Syrians died in an apparent chemical weapons attack. The United States, having established use of such weapons as a red line, seemed poised to act. But it backed off from military strikes and involved itself in an arrangement with President Bashar al-Assad’s government that would see the UN oversee the removal of Syrian stockpiles over a year. So not only did the Obama administration disappoint Saudi Arabia in pulling back at the last minute, it allowed Assad an opportunity to establish himself as recognized, legitimate ruler of Syria. Kept out of the loop on the key decisions, Saudi Arabia received confirmation that its importance for the United States had slipped down a few notches from the era of the Bush presidencies, when Bandar was ambassador in Washington.

Now barely two months later the United States has entered into a historic agreement with Tehran that could reverse over three decades of antagonism that has defined Middle East politics. The Iranian Revolution was a shock to the Saudi ruling family. It came at the same time as the siege of the Mecca mosque, when a millenarian Wahhabi cult opposed to Al Saud grabbed control of the Grand Mosque. The same year the Soviet Union invaded Afghanistan. Saudi panic for their future led to two things: ramping up Wahhabi clerical control over Saudi society and Saudi-funded jihad in Afghanistan that had consequences way beyond that country’s borders. Today, the revolutionary Islamic regime is still there, and it is on the path to winning recognition from its historic nemesis, the United States.

This is problematic for Riyadh for several reasons. One of Al Saud’s great gifts to its Western protectors has been a foreign policy made to facilitate – facilitate war in Kuwait, war in Iraq, Palestinian concessions to Israel, challenging Western-defined radicals, whether they are Hamas, Hibzullah, leftists – even funding rebels fighting a leftist government in Nicaragua in the 1980s. The Saudi message to its people – in as much as there was one – was that resistance and challenge does not work, our way of cooperation and facilitation is the smart way. To its Wahhabi clerical base – the key constituency in Al Saud’s alliance of governance – the message was that this was a quid pro quo: leave us alone on foreign policy because it is our policies that are securing the safety of this realm in which you have extensive rein (more than anywhere else, despite clerical complaints) to implement Sharia law.

The example of Iran – challenging the West and surviving – is doubly troubling because of the sectarian aspect. Hatred for the Shia is close to Wahhabi hearts. The expansion of Iranian influence over the past decade has been a source of great consternation for al-Wahhabiyya. During the war Iran’s Shi’ite ally Hizbullah fought with Israel in 2006, the Al Saud-Wahhabi hope was that Israel would finish the group off (though neo-Wahhabi clerics with Muslim Brotherhood leanings such as Salman al-Odah supported Hizbullah). The great hope was that at least Israel could be counted on to give it to the Iranians on the nose, if not the Americans themselves. This, we may forget easily now, was the policy debate and media discourse of the last seven years: will there be war or won’t there? will Israel go it alone? Will the U.S. turn a blind eye? Now Al Saud are looking rather weak before their religious constituency – they have been outmanoeuvred by a Shi’ite power that made a career of challenging the West.

Others are shifting to accommodate the new situation, including within the Gulf. The question is what can Saudi Arabia do? What does accommodation mean in a Saudi context? The issue is complicated because of the gerontocratic nature of the regime, and the jockeying for position that has been going on amongst senior princes over the past four years. Thus far the signs are that it is mired in the thinking of the past: Prince Alwaleed said in comments the other day that Sunnis don’t like Shia and governments would support an Israeli strike on Iran while declaring opposition in public, Saudi Arabia took an apparently fortuitous opportunity in Syria two years ago to stake a victory against Iran but now faces a mess of its own making, its idea of resolving the crisis to its benefit was an American attack that failed to launch. This is not the thinking of the future, it’s the repetition of the past.

We are told that Riyadh could decide to develop its own nuclear programme. Such vague talk. Riyadh, in concert with Gulf states and the IAEA  in Vienna, began looking into nuclear power in 2007. Enrichment, weaponizing – these are big moves for a leadership that has designed an entire polity around alliance with the United States. There is talk of a shift towards the Russians, just as there was much to say about economic ties with China some five years ago. The fact is that King Abdullah’s rule was characterized from the beginning by a policy of developing political and economic ties with a range of countries and regions, diversifying away from the unipolar America/West relationship. But we are far, far away from any alternative to the United States stepping up as protector in the Gulf.

The place to look for consequences is, I suspect, the domestic scene. The regime will feel embarrassed and weak. It will be sensitive to old-school Wahhabi ulama charges that it cannot defend Sunnism. It will be wary of the response of the Brotherhood-influenced clerics, who are softer on Iran and angered by the Saudi position on Egypt. It will fear Shi’ite-Iranian actions in Bahrain and Yemen, and perhaps choose to take the war to the Houthis with more Salafi activities (fighting already rose in recent weeks). It will be more determined to prosecute civil and human rights activists, stamp out protests and keep the Eastern Province Shia down. Perhaps we should expect that the use and abuse of both sectarianism and the Syrian war will help the regime in its short-term responses to these challenges.