What's Happening Between Saudi Arabia and Iran

As 2016 rung in, Saudi Arabia executed Sheikh Nimr al-Nimr. Sheikh Nimr was a leading Shia cleric in Saudi Arabia, and a critic of the royal family. He was a key figure in the "Arab Spring" protests in Saudi Arabia, and in 2012 the government arrested him. The majority of Saudi Arabia is Sunni, and there is great unrest in the Eastern provinces of the country right now, where Shias say they are being mistreated.

Iran, the other major military power in the region, is a Sunni, religiously-based nation. It is the "counter-balance" to Saudi Arabia in the region, and the two are mortal enemies. Iran was very unhappy with the execution, and on Saturday night, the Saudi embassy in Tehran was stormed by protestors. Saudi Arabia has responded by cutting diplomatic ties.

It's important to understand that this is not a new conflict, or an isolated incident. These countries are on opposite sides of the fights in Syria and Yemen. Saudi Arabia accuses Iran of funding terror groups. Iran accuses Saudi Arabia of doing the same. There is funding coming out of both for terror groups, but only on their own side of the Sunni-Shia divide.

It's doubtful that this unrest will start a bilateral war. The impact is likely to be felt more in Syrian Civil War talks, and more specifically in the Yemeni situation. The Saudis seem to feel unapologetic in their tough stance towards the Sunni cleric, and more than happy to anger the Iranians. I can't guess what their motivations are, or what brought this on, but very clearly it has the potential to destroy peace talks on many issues in the region. That is what you should watch going forward. That is likely where the issues will be going forward.