A major source of tension between Saudi Arabia and Iran for a long time, the Civil War in Yemen was also a regional proxy war, with Iran politically and militarily backing the insurgent Ansarullah (Houthi) Movement, which had seized control of the Yemeni capital in September 2014, while Saudi Arabia led an alliance, the Arab Coalition to Restore Legitimacy, to back the internationally recognised government of Yemen in its military campaign to regain power.

At present, no clear political process or roadmap has been formulated to resolve the crisis, although Tehran believes that the Saudi-Iranian agreement will accelerate international peacemaking efforts. Delegations from the Yemeni government and the Houthis are currently in Geneva in UN-sponsored talks over a prisoner swap. While the agenda makes no mention of a political process, the exchange is clearly a confidence-building measure intended to pave the way ahead. Behind this sudden and dramatic development are the series of secret talks between Riyadh and the Houthis in Muscat. The Omani-brokered talks aim to renew a truce that had expired more than five months ago.

The US, which has appointed a special envoy for Yemen with the aim of promoting a UN-sponsored drive, is among the mediating agencies that see the talks in Oman as a prelude to a comprehensive settlement process. But now, with the Saudi-Iranian agreement, some wonder whether Washington will continue to pursue this mediating course given its hostility towards Iran. Riyadh, for its part, appears to be pursuing a second path, parallel to the one with Beijing. Earlier this month, the Saudi Ambassador to Yemen Mohamed Al-Jaber flew to Moscow to follow through on the consultations that the Russian Deputy Foreign Minister Mikhail Bogdanov, had begun in Muscat about two weeks ago. The Yemeni question thus appears to have entered a qualitatively new  international mediating phase.

According to observers and analysts in Riyadh, no peace agreement in Yemen can take place without a guarantor. Beijing is well positioned to perform this role as it is close to Tehran, and Russia, which also has close ties with Tehran, could help. Riyadh will need to speak directly to the other side - Iran - instead of taking the uncertain detour via Washington. Therefore, after three US administrations’ military and diplomatic interventions in the Yemeni crisis, from Obama through Trump to Biden, Riyadh decided to veer away from the Washington approach. Evidently, it has left Riyadh so disappointed and let down that Saudi officials have spoken of a loss of trust in Washington. Riyadh has sustained numerous Houthi missile attacks, targeting Saudi infrastructure (Aramco facilities, Asir airports, seaports in Jeddah), exposing a defence vulnerability. Yet, Washington withdrew its Patriot missile systems from Saudi Arabia at the peak of those attacks.

Yemen sits at the intersection between Saudi Arabia’s and China’s interests. The closing statement of the Jeddah summit in 2022 makes this clear. It underscores the importance of deepening cooperation in the Belt and Road initiatives and welcomes Saudi organisations interested in entering partnerships in energy and investments in projects undertaken in the Belt and Road framework. The document also calls for strengthening Saudi Arabia’s position as a regional hub for Chinese firms involved in the production and export of energy sector products and for joint investment in energy projects in other countries in the region and in European and African countries that consume energy products. Yemen, in light of its central geopolitical position, has a vital role to play in this context, especially given how the Gulf of Aden and the Arabian Sea off of Yemen’s southern coast fit into the Belt and Road vision.

However, we should not underestimate the challenges facing a potential Beijing-led avenue to a solution to the Yemeni conflict. Firstly, it must be borne in mind that the Chinese-sponsored agreement between Riyadh and Tehran reaffirmed the principles of good neighbourliness and non-intervention in the domestic affairs of others, but it made no explicit mention of the war. In all events, the first and main step is to resume the truce between the Yemeni government and the Houthis or, more precisely, between Riyadh and the Houthis, and then to see if it holds and, if so, whether the Houthis are prepared to move forward to a political process. In this regard, the UN Envoy to Yemen, Hans Grundberg, flew to Tehran and reported positive exchanges with Iranian officials on the question of a truce.

Within Yemen, it appears that the Saudi-Iranian agreement has already had a positive impact on the warring parties. The Yemeni government welcomed the agreement and, in an official statement, expressed its hope that it will change Iranian policies towards Yemen. It added that the government “will continue to exercise caution towards the Iranian regime until it sees real change in its behaviour and destructive policies towards our country and the region.” The Houthis have significantly softened their tone towards Saudi Arabia while the spokesman for the Southern Transitional Council (STC) stated, “The Council hopes that [the agreement] will contribute to restoring security and stability in the region and the world.” He noted that the STC’s position reflected “a previous call made by the STC Chairman Aidarous Al-Zubaidi to both Saudi Arabia and Iran to engage in dialogue and resume bilateral relations, a call made in the spirit of promoting stronger relations between the peoples and countries of the region.”

Of course, it is too early to assess the effect of the Saudi-Iranian rapprochement on Yemen

Iran would not offer up the Houthis just to restore diplomatic relations with Riyadh. In fact, Iran will probably try to use whatever leverage it can wield through the process to strengthen the Houthis’ political position and, more importantly, it will not work to dismantle the Houthis’ sectarian ideological project after investing in it for nearly decade during the war. Moreover, the more Tehran feels it has something to gain through negotiating and bargaining mechanisms, the more likely it is  to try to protract the political process.

Presumably, if a truce leads to a lasting ceasefire agreement, this will generate a different mode and a different agenda for the political process. But while a power-sharing formula of the sort that Iran has alluded to might present a hurdle, it would not be as formidable an obstacle as the main concern, which is the theocratic leadership that currently sits in Sanaa. Ultimately, any future developments on the ground will be determined, above all, by how the big players split the dividends. In this regard, it does not seem to be in Iran’s interests to embrace the Chinese role wholly so much but to present Beijing as the new superpower that has replaced the US in the region. The Saudi-Iranian agreement, if it succeeds, may usher in a totally new era in the region.