Biden, who is on a two day visit to Saudi Arabia, met on Friday with Saudi Crown Prince Mohammed bin Salman, and King Salma. Following the meeting Biden said that he had a series of good meetings in Saudi Arabia.
Saudi Arabia hopes to develop tourist attractions there, part of the kingdom's effort to expand its economy beyond oil. Because of a complex diplomatic arrangement governing control of the strategically located island, America's departure required Israel's assent, and the deal was the latest reflection of warmer relations between the Israelis and Saudis.
The agreement followed an earlier announcement that the Saudis were ending strict limits on Israeli commercial flights over their territory.
The White House said in a statement after Biden's announcment that peacekeeprs would be removed from the island by the end of year.
The Peacekeepers has been on the island since shortly after the 1978 Camp David Accords. US troops have served as peacekeepers on Tiran Island as part of the Multinational Force and Observers (MFO) under the Treaty of Peace signed between Israel and Egypt.
The WH statment said that an "arrangements have been reached to remove the MFO peacekeepers and develop this area – which once sparked two multi-state wars in the region – for tourism, development, and peaceful pursuits."
It added that Saudi Arabia has agreed to preserve and continue all existing commitments and procedures in the area.
President Biden welcomed this arrangement, which was 'negotiated over many months and fully took into consideration the interests of all parties, including Israel,' according to the statment.
The MFO peacekeepers, including U.S. soldiers, will depart Tiran by the end of the year.
Jamal Khashoggi's Murder
Biden said he he brought up the murder of Jamal Khashoggi in his meeting Friday with Saudi Crown Prince Mohammed bin Salman, rejecting the idea that he was ignoring the kingdom's human rights abuses as he tries to reset a critical diplomatic relationship.
"I said, very straightforwardly, for an American president to be silent on an issue of human rights is inconsistent with who we are and who I am," Biden said. "I'll always stand up for our values."
U.S. intelligence believes that the crown prince likely approved the killing of Khashoggi, a U.S.-based writer, four years ago.
Biden said Prince Mohammed claimed that he was "not personally responsible'' for the death. "I indicated I thought he was,'' the president said he replied.
It was the first encounter between the two leaders, beginning with a fist bump outside the royal palace in Jeddah, in a relationship that could reshape security partnerships in the Middle East and the flow of oil worldwide.
For now, it appeared that they were taking incremental steps forward together. Biden announced that U.S. peacekeepers would leave the Red Sea island of Tiran by the end of the year.
Biden also said progress was being made on extending the ceasefire in Yemen, where Saudi Arabia had been battling Iran-backed militants, leading to a humanitarian crisis.
The president's three hours at the royal palace in Jeddah were seen as a diplomatic win for the crown prince, who has tried to rehabilitate his image, draw investments to the kingdom for his reform plans and bolster the kingdom's security relationship with the U.S.
Biden seemed to approach it as a necessary if somewhat distasteful step to improve relations with the world's top oil exporter at a time of rising gas prices and concern about Iran's nuclear ambitions.
The meeting drew outrage from critics who believed Biden was abandoning his pledges on human rights, particularly when it came to the murder of Khashoggi, a U.S.-based journalist who wrote for The Washington Post.
The United States played down expectations for any immediate increases in Saudi oil production, which could help alleviate high gas prices that are politically damaging to Biden back home. But the White House said it anticipated "further steps'' over coming weeks that "will help stabilize markets considerably.''
The current OPEC+ agreement expires in September, opening the door to potentially higher production after that.
Rising gas prices, which were compounded by the Russian invasion of Ukraine, are one of the factors that prompted Biden to reassess his approach to Saudi Arabia.
The U.S. president had long refused to speak to Prince Mohammed, the presumed heir to the throne currently held by his father, King Salman. But those concerns have been eclipsed by other challenges, including Iranian aggression in the Middle East and the faltering effort to use diplomacy to prevent Iran from building a nuclear weapon.
At the same time, Saudi Arabia wants to strengthen its security relationship with the United States and secure investments to transform its economy into one less reliant on pumping oil.
The Saudis held a subdued welcome for Biden at the airport in Jeddah, with none of the ceremonies that accompanied his earlier stop this week in Israel.
The president later sat down with King Salman, the 86-year-old monarch who has suffered from poor health, including two hospitalizations this year. Journalists were not allowed into the room, but the Saudis released a video of Biden shaking hands with the king while the crown prince looked on.
Afterwards, Biden and Prince Mohammed held a broader meeting with several advisers. The two men sat across from each other, an arrangement that burnished the perception that they are counterparts. It's an image that the crown prince, known by his initials MBS, has been eager to foster as he solidifies his path to the throne after sidelining, detaining and seizing the assets of royal rivals and critics.
There had been considerable speculation about both the choreography and the substance of how Biden, who had vowed as a presidential candidate to treat Saudi Arabia as a "pariah'' for its human rights record, would go about interacting with Prince Mohammed.
Access for journalists was limited. The White House travelling press corps was not present when Biden's fist bumped the crown prince, and reporters were only briefly allowed into their meeting. Almost none of their remarks could be heard. Biden did not answer when reporters asked if he still considered Saudi Arabia a pariah, nor did Prince Mohammed respond to a shouted question about whether he would apologize to Khashoggi's family.
"My views on Khashoggi have been absolutely, positively clear. And I have never been quiet about talking about human rights,'' Biden said earlier this week. "The reason I'm going to Saudi Arabia, though, is much broader.
It's to promote U.S. interests in a way that I think we have an opportunity to reassert what I think we made a mistake of walking away from our influence in the Middle East.''
On Saturday, he'll participate in a gathering of leaders from the Gulf Cooperation Council, Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the United Arab Emirates, before returning to Washington.
The leaders of Mideast neighbours Egypt, Iraq and Jordan are also to attend, and Biden's national security adviser said Biden would make a "major statement'' on his vision for the Middle East.
The Saudi visit is one of the most delicate that Biden has faced on the international stage. Any success in soothing relations could pay diplomatic dividends as the president seeks to ensure stability in the region.
But it could also open Biden, already floundering in the polls at home, to deeper criticism that he is backtracking on his pledges to put human rights at the center of foreign policy.