A major arms sale that the Bush administration is offering Saudi Arabia and other Persian Gulf allies in order to deter Iran has been delayed because of objections from Israel, according to a report in the New York Times. The report quotes unnamed senior United States officials as saying that Israel believes the advanced weaponry would erode its military advantage over its present and potential enemies.
Twice in the past month Bush administration officials scheduled briefings for members of the Senate Foreign Relations Committee about the planned sales. Both times, the briefings were canceled at the last minute because of the Israeli concerns, according to U.S. administration officials and Congressional staffers.
Meanwhile, Israel and the United States have been in discussions over a new military aid package that could increase American support for Israel’s military to around $3 billion from $2.4 billion. 
Israel is concerned about the transfer of precision satellite-guided weapons
Israeli officials, including former defense minister Shaul Mofaz, have come to Washington in recent months to lobby against elements of the planned sales to Saudi Arabia. In particular, Israel is concerned about the transfer of precision satellite-guided weapons that would give Saudi warplanes the ability to strike targets extremely accurately.
Several officials in the State Department and the Pentagon said that plans to formally notify Congress about the potential weapons sale had been delayed "at least until later this month." Congress will then have 30 days to decide whether to block the sale.
One American defense industry executive said the planned sales to Saudi Arabia — which include tanks, warships and advanced air defense systems — could eventually total $5 to 10 billion.
Capitol Hill Supports Israel's QME
Support for maintaining Israel’s qualitative military edge - or QME, as it is known - remains strong on Capitol Hill, and administration officials are discussing how to allay the concerns, including the possibility of a separate arms package for Israel. “Israel has expressed concern that this proposal could affect the QME,” said a Defense Department official. “We don’t want to go to Congress until we’ve got everybody on board.”
“The Israelis understand that it’s in our interest and their interest” that the United States try to shore up military systems for Sunni Arab allies, said a senior administration official. But Israel is also concerned that there could be a revolution in Saudi Arabia that would leave the Saudi arsenal in the hands of militant Islamists.
“Osama bin Laden would like to change the Saudi government to what he considers a real Islamist government," said David Schenker, a former Pentagon official who is now a senior fellow on Arab politics at the Washington Institute for Near East Policy. "So Israel doesn’t want them to have this heightened military capability.”
Aside from the Israeli objections to part of the arms package, Bush administration officials have had difficulty getting some Gulf countries to commit to arms purchases, according to Middle East analyst Kenneth Katzman. Saudi Arabia and other Gulf countries “are not sure what the long-term U.S. commitment is, and they don’t want to be seen as ganging up on Iran in case we leave,” Mr. Katzman said.