Officials from Iran and Saudi Arabia met this week in Baghdad for a fourth round of talks this year, following a months-long hiatus after the election of Iran's new president.
Why it matters: The meetings in Iraq constitute the first serious attempt at dialogue between the two regional rivals following years of tensions and rhetorical venom.
Get market news worthy of your time with Axios Markets. Subscribe for free.
Iraqi sources say the agenda is dominated by efforts to repair the bilateral relationship and by regional issues concerning both sides.
Flashback: Saudi Arabia cut off relations with Iran in January 2016. The move came after Iranian protesters stormed Saudi diplomatic facilities over Riyadh’s execution of dissident Shiite cleric Nimr al-Nimr.
The relationship deteriorated further following the election of Donald Trump, who openly sided with the Saudi leadership in its long-standing confrontation with Iran.
Given the administration's animosity towards Iran, Riyadh not only felt no need to talk to Tehran, but was arguably even disincentivized to do so.
Between the lines: The Iran-Saudi dialogue coincides with President Biden’s arrival into office and his attempt to pivot attention away from the region.
That has been interpreted by many observers as a sign that Arab partners of the U.S. will be more prone to engage Iran if Washington isn't unconditionally backing the regional status quo.
How it happened: The Iran-Saudi dialogue is an outcome of Iraqi Prime Minister Mustafa al-Kadhimi’s personal efforts to promote a more integrated region and turn his country into a bridge rather than a battleground for competing foreign powers.
Kadhimi hosted a summit in late June with the leaders of Egypt and Jordan, at which the three countries agreed to deepen economic and security ties.
In August, Kadhimi gathered a wider array of leaders from key states such as Egypt, Iran, Jordan, Saudi Arabia and the United Arab Emirates.
What’s next: After the event, an Iraqi political source close to Kadhimi revealed to Amwaj.media that the Baghdad Conference was never envisioned as a one-off.
“The participants are mulling the idea of making this an annual gathering — each time in a different capital," the source said.
At a recent follow-up meeting of the Baghdad Conference, held on the sidelines of the UN General Assembly, all sides —including Iran and Saudi Arabia — agreed that the next session will be held in Jordan.
What to watch: Iraq is set to hold parliamentary elections on Oct. 10, and while Kadhimi is not on the ballot, he is seeking domestic, regional and international backing for a second term.
The outcome could have bearing on the future of the regional dialogue, given Kadhimi's role in promoting it.
Like this article? Get more from Axios and subscribe to Axios Markets for free.