US State Department
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The Biden administration and Saudi Arabia are finalizing an agreement for US security guarantees and civilian nuclear assistance, even as an Israel-Saudi normalization deal envisioned as part of a Middle East “grand bargain” remains elusive, Reuters reported on Thursday, citing seven people familiar with the matter.

US and Saudi negotiators have prioritized a bilateral security accord that would then be part of a wider package presented to Prime Minister Benjamin Netanyahu, who would have to decide whether to make concessions to secure historic ties with Riyadh, five of the sources said.

State Department spokesperson Matthew Miller said on Thursday, “We’re very close to reaching an agreement” on the US-Saudi portion of the package, adding that details could be ironed out “in very short order.”

That part of the plan is likely to call for formal US guarantees to defend the kingdom as well as Saudi access to more advanced US weaponry in return for halting Chinese arms purchases and restricting Beijing’s investment in the country, according to foreign diplomats in the Gulf and sources in Washington.

The U.S.-Saudi security accord is also expected to involve sharing emerging technologies with Riyadh, including artificial intelligence, according to people familiar with the matter.

US officials hope Netanyahu will not want to pass up the historic opportunity to open relations with Saudi Arabia, but are mindful of the domestic political pressures he is under, according to Reuters.

Israel and Saudi Arabia appeared to be on track towards normalization before Hamas’ October 7 attack against Israel and the war in Gaza which followed.

Shortly after the start of the war in Gaza, sources told Reuters that Saudi Arabia is putting the US-backed plans to normalize ties with Israel on ice.

Saudi Foreign Minister, Prince Faisal bin Farhan, later said that he believes talks on normalization between Israel and Saudi Arabia will resume immediately after the conclusion of the war in Gaza.

More recently, the top Saudi diplomat indicated that normalization with Israel requires both an end to the fighting in the Gaza Strip as well as the establishment of a Palestinian state, which Saudi officials have long insisted is a condition for normalization with Israel.

“Putting a proposal on the table, that's one thing, a proposal that we could take to Israel (for normalization),” Miller said on Thursday, adding that Saudi Arabia has made clear there will be no normalization deal "while the conflict in Gaza is still raging.”

Miller said the components of the broader package - the US-Saudi deal, potential normalization with Israel and a pathway to Palestinian statehood - would all be linked together, stressing, "None go forward without the other."