Challenges and Opportunities for Iran-GCC Relations Under Pezeshkian

Relations between Iran and the GCC member states have fluctuated over recent decades. Various Iranian administrations, reformist and conservative alike, have attempted to improve ties with GCC countries, but these efforts have often been met with obstacles due to sporadic tensions and underlying issues in the cross-Gulf relationship. The de-escalation process in Iran’s foreign policy began during Akbar Hashemi Rafsanjani’s second term in office (1993-1997), and was notably emphasized under his successor, reformist Mohammad Khatami (1997-2005). Though this approach fell dormant under the leadership of Mahmoud Ahmadinejad, it was readopted anew by Hassan Rouhani in 2013; however, events during Rouhani’s tenure, such as the 2016 attack on the Saudi embassy in Tehran, ultimately led Iran and Saudi Arabia to sever ties, grinding the process to a half. During Ebrahim Raisi’s shorter-than-normal administration, these efforts saw some recovery, with the two sides re-establishing relations under a Chinese-mediated agreement in 2023.

Today, in the words of Iranian Foreign Ministry officials, Iran-Saudi relations are “progressing positively.” Tehran anticipates further development of these interactions under newly elected President Masoud Pezeshkian. One obvious area for improvement would be for Iran to re-establish relations with Bahrain, which followed Saudi Arabia in severing them in 2016 but has not yet agreed to restore them.

Progress, But Tensions Remain

One of the key factors that could facilitate the expansion and improvement of relations between Iran and the GCC is the reciprocal need to deepen and enhance ties. Despite normalization of ties between Iran and Saudi Arabia and a broader thaw in Tehran’s relations with the GCC, little tangible progress has been made in actually improving political and economic relations. Iran and Saudi Arabia are each regional powers and large economies and enjoy significant potential for stronger ties, but their interactions have been limited to exchanging ambassadors—at least for now.

The core elements of Iran’s Middle East strategy revolve around its relationships with Syria, Iraq, Iraqi non-state actors, Hezbollah in Lebanon, Palestinian militant groups, and the Houthis in Yemen—together bracketed into the so-called “Axis of Resistance” against Israel. Iranian leaders have historically viewed these relationships through a security, military, and defense prism. Despite the recent easing of tensions between Iran and the GCC states, Tehran’s support for these nations and groups has been a major point of contention in cross-Gulf relations, and the GCC states have consistently expressed concerns about machinations associated with the Axis.

Pezeshkian’s presidency is coinciding with considerable uncertainty regarding Iran’s foreign policy outlook. His election as a mild-mannered pragmatist with reformist inclinations has led many, including neighboring Arab countries, to view his presidency as a precursor to limited change in Iran’s foreign relations, rather than an opportunity for a dramatic shift. Nevertheless, there is cautious optimism about the potential for further diplomatic breakthroughs under Pezeshkian’s leadership. His moderate approach, coupled with an emphasis on dialogue, has raised expectations for a more flexible and cooperative foreign policy on the part of the Islamic Republic.

Regional Dynamics and External Influences

A flurry of positive reactions from GCC member countries following Pezeshkian’s election win marks a notable shift in regional diplomacy. Numerous messages of congratulation from GCC leaders, along with GCC envoys attending Pezeshkian’s inauguration and meeting with Iranian officials, indicate a widespread desire to deepen ties with Tehran. 

Historically, Arab countries in the region have been cautious about reformist administrations in Iran. In the past, rhetoric about improving Iran-GCC ties has rarely led to substantial action. Moreover, the GCC nations also worry that a reformist government in Iran could improve Tehran’s ties with Western governments at their expense. However, ongoing geopolitical shifts in the region seem to be altering this deep-seated dynamic. Pezeshkian’s administration emphasizes dialogue and regional cooperation, which is likely to address these concerns to some degree and potentially foster a new era of engagement.

Pezeshkian’s inauguration was a significant event for the Islamic Republic to show off its regional might—and suggested a continuity in its foreign policy. The seating arrangement included representatives from militant groups like Hezbollah, Hamas, Islamic Jihad, and the Houthis placed prominently ahead of dignitaries from other countries, underscoring Iran’s continued support to these groups. This arrangement highlighted Tehran’s strategic messaging to assert its leadership and commitment to its regional alliances and “Axis of Resistance.”

Former Hamas chief Ismail Haniyeh’s prominent presence at the event and other symbolic gestures, such as his ‘raised hands’ photo op with the new president, served to reinforce Iran’s solidarity with these groups and its deep-rooted support for their causes. Meanwhile, Pezeshkian reaffirmed in his inauguration speech Iran’s favor for “resistance” groups, maintaining the Islamic Republic’s established policies in this domain. Such emphasis on regional alliances and anti-Israeli resistance is part of a broader strategy to consolidate Iran’s regional clout.

But in the aftermath of the inauguration, the new administration was immediately plunged into crisis by the assassination of Ismail Haniyeh in Tehran, reportedly by Israel’s  Mossad—embarrassing the Islamic establishment only hours into Pezeshkian’s presidency and drawing into question Iran’s ability to protect its interests and allies. In this context, the fallout for Pezeshkian’s administration could be profound, as the incident could have undermined the new government’s efforts to foster its position, make good on its promises of increased regional cooperation, and assert its strategic objectives. Iran’s expected response has been notably slow, but once it occurs, the ensuing escalation might strain relations with its regional allies and lead to heightened tensions with neighboring Arab countries. Perhaps for this reason, the Islamic government has thus far avoided a flashy response, instead seeking to contain the crisis and manage tensions. 

Historically speaking, any time Iran has sought to pursue a more conciliatory approach in its relations with the West, enormous obstacles have emerged. In the final year of the Rouhani administration, Iranian negotiators expressed interest in returning to the JCPOA nuclear deal, but these plans were abruptly thrown into chaos by the assassination of of Mohsen Fakhrizadeh, a key Iranian nuclear scientist. In the aftermath of the killing, progress toward a renewed JCPOA was halted—a notable example of how external interference can undermine Iran’s diplomatic initiatives.

Despite these challenges, Arab countries are keen to maintain the current trajectory of de-escalation. The success of substantial investment by GCC countries such as Saudi Arabia and the UAE in tourism and other sectors largely depends on stability and security. Therefore, uneasy ties with Iran could jeopardize the region’s security and obstruct these countries’ ambitious development plans. The final statement from the Extraordinary Meeting of Foreign Ministers of the Organization of Islamic Cooperation held in early August in Jeddah, which condemned the assassination of Haniyeh, along with the repeated calls from Arab nations for restraint and efforts to reduce regional tensions, underscores this commitment to stability and constructive engagement. In the same line, the Jordanian foreign minister’s unexpected visit to Iran in early August highlights the sensitivity and potential shifts in regional diplomacy.

Leveraging Momentum from the Raisi Era

Fortunately for these relationships, Pezeshkian inherits a relatively positive diplomatic momentum from Raisi’s presidency, particularly in light of resumed ties with Saudi Arabia. This diplomatic achievement provides a valuable platform for Pezeshkian’s nascent administration, offering an opportunity to further improve relations with other Arab countries in the Gulf.

However, while this positive momentum is significant, it is important to recognize that the direction of Iran’s foreign policy is shaped not only by the elected government, but also by various powerful institutions accountable only to Supreme Leader Ali Khamenei. The interests and influence of the military and other organizational bodies are instrumental in shaping foreign policy decisions. This complex decision-making process can sometimes lead to conflicts between individual or group interests at the cost of national interests, making substantial shifts in foreign policy a difficult issue.

The ability of Pezeshkian’s administration to manage and interact with domestic influences, particularly the Islamic Revolutionary Guard Corps (IRGC) and other powerful institutions, will be crucial in determining the success of his foreign policy initiatives. Former presidents Khatami and Rouhani also ran into significant challenges from the IRGC, particularly regarding the management of proxy networks across the region.

Pezeshkian appears to be in a somewhat stronger position, having already established a more cooperative relationship with the military and the Supreme Leader. Since his election, he has repeatedly emphasized his loyalty to Khamenei in a bid to win his support. He has articulated that the guidelines set by the Supreme Leader should shape foreign policy, including the development of relations with neighboring countries and cooperation with Asian nations. Additionally, he has reportedly received Ayatollah Khamenei’s nod to advance his strategies in foreign policy.

Pezeshkian has also shown a talent for mollifying Iran’s conservative principlists and other powerful factions in the Iranian “deep state.” There is tangible evidence that the arrangement and selection of ministers to serve in his cabinet was aimed at appeasing political rivals and mitigating disruptions from radical factions. Of course, the manner and political affiliation of some cabinet nominees sparked considerable criticism among the public and reformist political groups, who had been under the impression that Pezeshkian was a reformist and would take the government in a decidedly pro-reformist direction. Nonetheless, the strategy sought to encourage hardliners to cooperate more effectively with his administration, potentially neutralizing their hostility.

During Raisi’s presidency, interference by parallel institutions and obstruction by radical elements in shaping relations with Arab countries, especially in the Gulf, fell to their lowest levels. If Pezeshkian can proceed with the same open and flexible diplomacy, his Ministry of Foreign Affairs may be able to pursue a coherent and realistic program to enhance relations with the GCC, without causing significant internal disruptions.

Unresolved Issues

In spite of Pezeshkian’s productive start and positive signals from the GCC states, a handful of complex regional issues continue to impede progress in bilateral relations. Although Iran and the UAE are significant trading partners, their dispute over three strategic Persian Gulf islands has long overshadowed their diplomatic relations. Another unresolved matter is the jointly-owned Al-Dara/Arash gas field dispute, which could negatively impact efforts to improve relations between Tehran and the GCC countries with an interest in the field.

A third major flashpoint for future tensions lies in the south, where the Houthis in Yemen remain restive and extremely anti-Saudi in their outlook. If the Houthis resume their cross-border attacks on Saudi Arabia or the UAE, progress toward de-escalation in tension between Iran and GCC countries could be reversed. This concern is heightened by recent threats from Abdul Malik al-Houthi, the leader of the movement, who in early July warned that it could target Saudi Arabia’s airports, banks, and ports. The potential normalization of relations between Saudi Arabia and Israel could also eclipse de-escalation efforts between Tehran and Riyadh.

Meanwhile, the potential return of former U.S. President Donald Trump to power in Washington could lead to significant shifts in relations between Iran and the GCC countries. If re-elected, Trump would likely alter U.S. foreign policy considerably, especially given the events that transpired in the region and the world under outgoing President Joe Biden. If Trump returns to power, it could profoundly impact the decisions by GCC members, particularly Saudi Arabia and the UAE, raising questions about their responses.

In short, Pezeshkian’s presidency presents both significant challenges and opportunities for Iran-GCC relations. The success of his foreign policy will chiefly depend on his ability to address regional security concerns, manage domestic political dynamics, and capitalize on the positive momentum from his predecessor’s diplomatic achievements. While the path to improved relations is fraught with risks and uncertainties, there is potential for meaningful progress if both Iran and the GCC are sincerely willing to engage in constructive dialogue and cooperation.

The views and opinions expressed in this article are those of the authors and do not necessarily reflect the views of Gulf International Forum.