Steven Cook is a senior fellow for Middle East and Africa Studies based in Washington with the Council on Foreign Relations. To Cook, the new agreement isn’t as surprising, or shocking to the constellation of power in the Middle East, as it might seem. Behind all their conflict, the Iranians and the Saudis have been finding gradually more and stronger incentives to put their differences aside; they needed help settling them; and China was at hand and happy to give it. The development shows how radically the position of the United States in the Middle East has changed over the past 30 years—but, Cook says, the Chinese aren’t simply replacing the Americans in the region; something altogether new is taking shape.

Steven Cook: The global perception of what’s happened is interesting to start with. There’s been a tendency to see the Iranian-Saudi deal as the mark of a sudden and dramatic shift in the region. After all, Washington has been highly focused on the global challenge from China; the media—U.S. and international—has been highly focused on Washington being highly focused on the global challenge from China; and then, all of a sudden, it comes out that China has brokered a grand bargain between, of all countries, Iran and Saudi Arabia.

Yet if you look at the substance of the deal, it’s an agreement to reestablish diplomatic relations between Tehran and Riyadh. The substance isn’t unprecedented. In the current environment, it may have been a little too easy for commentators in the media to lose sight of the fact that Iran and Saudi Arabia have maintained diplomatic relations before—through some very frosty and tension-filled years, at that.

Okay, not in the last six years, so something important has happened here. And okay, the deal was brokered by the Chinese. That’s new—and undoubtedly something important too, because it shows that Beijing is now a real factor in the Middle East. But we have to remember, if anyone was going to broker this deal, it wasn’t going to be the United States—because the United States doesn’t talk to Iran.

Nangle: Iran and Saudi Arabia have had, as you say, a frosty and tension-filled relationship, going back more than 40 years—to Iran’s Islamic Revolution in 1979. Iran has since staked a lot of its regional and international reputation on resistance to the U.S. and its allies, with the Saudis being one of the most prominent among them. Why would Iran want to reestablish diplomatic relations now?

Cook: In the days after the deal, the Iranian media was very chirpy about the whole thing—making a lot of the meetings that would now take place on the road to reestablishing diplomatic relations, the Iranian delegations that would now be going to the United Arab Emirates, and so on.

It was clear to me, listening, that this wasn’t just propaganda or posturing. You could see an emerging sense that establishing diplomatic relations with the Saudis now is a powerful way to drive a wedge between them and the Americans—Saudi Arabia being the big dog in the Gulf; being such close allies with the U.S. over the years; and now being closer than ever to Israel, as Israel continues to normalize relations with its Arab neighbors all around. Of course, the Iranians know there were already divisions between the Saudis and the Americans, but you can see in the Iranian response a view that the deal could help them exploit these divisions—in ways that will redound to Iran’s benefit.

At the same time, the Iranians have been long on the ropes economically and with their population domestically—and the potential for Saudi and Emirati investment is very alluring. It also creates the opportunity to explore new deals with the Chinese, who’ve been bailing the Iranians out with investment, supporting China’s further prominence in the region—to the further disadvantage of the United States.

“More than anything, the Saudis really, really want to get themselves out of the civil war in Yemen, where they and the Iranians have been supporting opposing sides as proxies since 2014. If relations with the Iranians improve, and there’s dialogue, it raises the chances of being able to withdraw. The Saudis know now what a mistake it was to get involved in Yemen; they know the Iranians and the Houthis—the ethnic group leading one side of the civil war, backed by the Iranians—have shared an interest in keeping them pinned down there; and they know the United States hasn’t been able to extricate them. The Saudis don’t know, yet, if the Iranians are going to cooperate on account of the new deal. But they do know the odds have now gone up.”

“The Chinese have their own incentives. What’s really in it for them is that they’re very serious about their neutrality in the Middle East, and they very much want the region to be stable, so they can pursue their mercantilist policies—meaning state support for Chinese firms, Chinese exports, and China’s currency. They don’t want two of their biggest oil suppliers to be at odds, undermining the stability of the region, and potentially disrupting the flow of oil to China. If all of this comes at the expense of the United States, that may be an added benefit for Beijing. But they’re much more interested in ensuring that the region remains stable and that they continue to get oil they want from it.”

“It seems to me, the picture taking shape here isn’t going to be so much about the ups and downs of the United States and the Chinese. It’s going to be about how the partners of the U.S. and the Chinese in the region are becoming more adept at playing both sides. I’ve heard representatives of Middle Eastern countries say as much in the region, myself: This isn’t our grandfather’s Middle East. We have agency. We’re going to order this region on our own. And we’re going to pursue our interests as we see fit; we’re not going to let outsiders do it for us.”