A major breakthrough in international diplomacy was announced Friday when Saudi Arabia and Iran revealed that they had agreed to resume normalized relations in a deal brokered by China.

The countries announced the deal in a joint statement, saying Iran and Saudi Arabia, the two largest Middle Eastern nations by area, will resume diplomatic relations and each reopen embassies in the other country within two months. 

The plan will return Saudi Arabia and Iran to normalized relations after the kingdom cut ties with the other nation in 2016, and will likely have lasting effects throughout the Middle East and the rest of the world. 

Here are five things to know about the Chinese-brokered deal between Saudi Arabia and Iran: 

It reduces tensions in the Middle East between two regional powers

Iran and Saudi Arabia may have only officially broken off diplomatic relations in 2016, but tensions between the two countries are deeply rooted in history and religion. 

Saudi Arabia has historically followed the Sunni branch of Islam, while Iran has followed the Shia branch. The split between the two branches dates back to the seventh-century, when it arose amid debates over who the rightful successor to the Prophet Mohammed was, according to the nonpartisan think tank Council on Foreign Relations. 

In a more recent source of tension, the Iranian Revolution in 1979 brought Ruhollah Khomeini to power, and he ruled as ayatollah, bringing together government and religious leadership under Shia Islam. The new Iranian government began supporting Shiite groups in other countries in the region, while Saudi Arabia was prompted by the revolution to strengthen its Sunni connections, according to the council.

Since then, Iran and Saudi Arabia have not directly fought each other but have engaged in a series of proxy conflicts.

Saudi Arabia supported Iraq during its war with Iran in the 1980s. In more recent years, Iran has supported the regime of Syrian President Bashar al-Assad, who is a member of a sect that arose from Shia Islam, while Saudi Arabia has supported rebels seeking to overthrow him in the Sunni-majority country. Saudi Arabia has also supported a Sunni government in exile in the civil war in Yemen, while Iran has backed the Houthi rebels, who are Shia. 

As Saudi Arabia and Iran improve their ties, the normalization of their relations could impact these conflicts, too.

It demonstrates China’s growing influence on the world stage 

Another factor of the deal in addition to the agreement itself is the fact that China was the one responsible for moderating it. The agreement came after four days of previously undisclosed talks in Beijing. 

China has been pushing to challenge the U.S. role as the world’s superpower for years, and their success in securing the agreement weakens the U.S. position in the region. 

The United States has had longstanding but recently tense relations with Saudi Arabia, especially since the 2018 assassination of journalist Jamal Khashoggi, who criticized the Saudi regime. U.S. intelligence assessed in 2021 that Saudi Crown Prince Mohammed bin Salman approved an operation to kill or capture Khashoggi. 

The U.S. has had fraught relations with Iran for decades since the 1979 Iranian Revolution, making it likely impossible for the U.S. to arrange such a deal between the two Middle Eastern powers. 

China has meanwhile bought substantial amounts of oil from Saudi Arabia and stayed close to Iran. 

Some international affairs experts have said the agreement signals China is getting more involved in diplomatic engagement of the Middle East. 

“It should be a warning to U.S. policymakers: Leave the Middle East and abandon ties with sometimes frustrating, even barbarous, but long-standing allies, and you’ll simply be leaving a vacuum for China to fill,” said Jonathan Panikoff, the director of the Scowcroft Middle East Security Initiative for the Atlantic Council, in a Friday analysis. 

It could complicate normalization of Saudi-Israeli relations 

Another international agreement that could be brewing is one to normalize relations between Saudi Arabia and Israel, but the Saudi government’s deal with Iran could make accomplishing that more difficult. 

Israel has recently increased its ties to several of its Arab neighbors, in large part through the 2019 Abraham Accords that saw Israel normalize relations with the United Arab Emirates and Bahrain. Sudan and Morocco soon after followed in establishing diplomatic relations with Israel. 

Israeli Prime Minister Benjamin Netanyahu has indicated that he wants to secure normalized relations with Saudi Arabia, but Iran has long been an adversary of Israel. 

Israel has been one of the fiercest critics of Iran and its nuclear program, with its government under Netanyahu opposing the 2015 nuclear deal that saw restrictions placed on the program in exchange for the U.S. lifting sanctions on the Iranian regime. 

The closer ties between Saudi Arabia, with whom Israel wants a better relationship, and Iran, one of its top adversaries, could make a deal more complicated. 

People familiar with ongoing discussions told The New York Times that Saudi Arabia has laid out its demands for recognizing Israel, which include a security pledge from the U.S., the development of a civilian nuclear program and reduced restrictions on U.S. arms sales. 

President Biden seemed to declare support for the Saudi-Iranian deal in comments Friday, saying that “Better relations between Israel and their Arab neighbors are better for everybody.” 

It may bolster Assad’s government in Syrian Civil War 

The Syrian government applauded the deal between Saudi Arabia and Iran after it was announced, saying that it would help bring stability to the Middle East. 

The agreement could give a strategic advantage to Assad’s regime as he tries to stay in power amid an ongoing and lengthy civil war. 

Fighting broke out in 2011 in the country following Assad’s strong and violent crackdown on protests during the Arab Spring. The war has become a multi-sided conflict and a proxy war between Iran, supporting Assad, and Saudi Arabia, supporting the rebels. 

Countries tried to isolate Syria following its violent response to the protests, suspending the country from the Arab League, but the Syrian Foreign Ministry said a consensus is “growing” among Arab countries that isolating Syria is not working and that engagement is necessary. 

Assad’s forces have meanwhile been able to recapture most major cities and hold most of the country, though rebel groups still hold a portion. Some experts and officials have said only a political solution can end the conflict, but any pullback in support of the rebels by Saudi Arabia following the deal with Iran could help Assad close in on retaining power. 

It could help lead to end of the war in Yemen 

The civil war in Yemen has been the other major still-ongoing conflict that has seen Saudi Arabia and Iran engage in a proxy battle. 

Both the Yemini government and the Houthi rebels have claimed to be the legitimate authority in Yemen. The war has caused a massive humanitarian crisis as tens of thousands of people have been killed and millions have been suffering from hunger and illness. 

The war has waged on for more than eight years, but much of the international community has signaled an interest in bringing it to an end. Former Yemini President Abdrabbuh Mansur Hadi stepped down from office last year to transition the government to a council that could find a political solution to the conflict. 

Saudi officials have also pushed for ending the war and said earlier this year that progress was being made. 

Some members of Congress have also advocated for a war powers resolution to end U.S. support for the Saudi intervention in Yemen. Biden ended U.S. assistance to Saudi-led offensives in the country in 2021, but the U.S. still sells arms for the conflict and shares intelligence. 

The two key backers of the sides in the conflict, Saudi Arabia and Iran, agreeing to normalized relations could help the government and rebels reach an accord to end the violence.

The Associated Press contributed to this report.