U.S. Inks Enrichment Deal with Saudi Arabia

The New York Times in extensive coverage reported that the Trump administration plans to announce a broad nuclear agreement—known as a 123 Agreement—with Saudi Arabia. Last week CNN reported that the nuclear deal was “in limbo.” The deal was first reported on Tuesday 7/21 by the Wall Street Journal.

The deal establishes a framework for civilian nuclear cooperation, potentially allowing the kingdom to enrich uranium or reprocess plutonium on its own soil following a joint economic feasibility study. The administration estimates the accord will bring billions of dollars to the U.S. nuclear industry, particularly benefiting reactor designer Westinghouse.

Here is a summary of news media coverage followed by some brief observations of what may happen next.

Key Terms and Proliferation Concerns

To secure the agreement with Crown Prince Mohammed bin Salman, President Trump conceded to terms that step back from previous U.S. nonproliferation standards:

• Enrichment Rights: Unlike the 2009 “gold standard” agreement with the U.A.E.—where the nation surrendered fuel production rights—Saudi Arabia will likley be allowed to enrich fuel domestically.
• Inspection Limits: Terms may limit international inspectors from accessing sites potentially tied to weaponization. Saudi Arabia has not signed the “Additional Protocol” to the Nonproliferation Treaty that provides for unrestricted access to inspect civilian nuclear plants like enrichment plants and commercial reactors.
• Secret Side Letters: The deal includes two classified side letters that the administration claims contain sensitive security and proprietary information, though some lawmakers demand their release before voting.

Opponents in Congress and Israeli officials express concern that the kingdom could leverage a civilian project to build nuclear weapons—a step Prince Mohammed previously vowed to take if Iran developed a bomb. However, Secretary of State Marco Rubio affirmed that the U.S. would not sign any deal leading to proliferation risks.

Geopolitical Context and History

Efforts toward a U.S.-Saudi nuclear deal have evolved across multiple administrations:

• Shift from Israel Normalization: Under President Biden, nuclear cooperation was tied to Saudi Arabia recognizing Israel. President Trump separated these issues following the October 7, 2023 Hamas attacks. Israel may have limited leverage in Congress relative to opposing approval of the 123 Agreement due to reports that PM Netanyahu had undue influence over President Trump that goaded him into starting the war with Iran.
• Strained Diplomacy: The agreement aims to stabilize U.S.-Saudi ties after tensions flared over the ongoing war with Iran, during which Saudi Arabia denied the U.S. use of its airspace. The U.S. has a major airbase in Saudi Arabia. Israel is an undeclared nuclear state believed to have multiple nuclear weapons of its own which may complicate its efforts to mount a credible opposition effort with Congress.
• Defense & Security: While the Saudis initially sought a Senate-ratified mutual defense treaty, the administration instead agreed to a broader defense arrangement including F-35 fighter jet sales. Amid regional uncertainty, Saudi Arabia continues to rely on U.S. air defense missiles while maintaining diplomatic dialog with Iran. The Saudi government and other Middle East nations now see the U.S. military as being ineffective as a security guarantee relative to containing attacks from Iran that have severely damanged oil refining and gas production plants and ports.
• Uranium Supplies: Saudi Arabia’s domestics uranium deposits were deemed to be “uneconomic” as a result of extensive prospecting. It is unclear where Saudia Arabia would get the feedstock (UF6) from to enrich uranium. Pakistan is a plausible source for centrifuges and UF6. The US does not manufacture centrifuges for export and the consortium in Europe that makes them is unlikely to sell their units to Saudi Arabia if it does not sign the Additional Protocol. Without signing the Additional Protocol to allow IAEA inspections, Saudi Arabia may also be barred from acquiring uranium via the Nuclear Suppliers Group. Russia, which is aligned with Iran, is unlikely to be a supplier. China has a large uranium enrichment plant in Lanzhu which uses gas centrifuges. However, as a member of the Nuclear Suppliers Group it may be constrained from selling UF6 or centrifuges to enrich nuclear fuel to Saudi Arabia.

Next Steps

Though the agreement requires Congressional review under the Atomic Energy Act, it is expected to pass as opponents would need a veto-proof majority to block it. The NYT assesses that “fierce debate is expected as Congress evaluates the concessions and side letters.” It is unclear when the 90 day clock for review starts ticking, but Congess has until the end of 2026 to make up its mind.

Reaction from Iran

The Islamic Revolutionary Guard Corps (IRGC) will likely do everything within its military and geopolitical capabilities to spike the deal. One thing is clear, and that is that any nuclear facilities built in Saudi Arabia will be targets for its missiles and drones. Iran’s IRGC is the political power center within Iran that has ambitions to develop a nuclear weapon. The last thing it wants is for Saudi Arabia to be a path to having one of its own.

While some might say that the Saudi government needs a form of deterrence to Iran’s nuclear program, in fact building a uranium enrichment plant and civilian nuclear reactors, without accepting IAEA inspections, will likely cause Iran to accelerate its nuclear program. The U.S. will lose any chance of negotiating an end to Iran’s nuclear ambitions.

Short Term Prospects

Trump and Iran currently are engaged in a conflict to see who blinks first. In the process they will wreck the global economy and particularly in the Middle East. This will lead to further political instability, especially in Southeast Asia, due to resource shortages including fuel and fertilizer.   

Trump’s approval of the Saudi nuclear deal is a form of escalation of the current conflict and will not bring Iran to the negotiating table.

As long as hostilities with Iran are ongoing, it is unlikely that Saudi Arabia will commence construction of a uranium enrichment plant. Prospects for building Westinghouse 1,150 MW AP1000 PWRs are equally remote until Iran reaches a settlement with the U.S. that opens the Straits of Hormuz and ends the Houthi blockade of the South end of the Red Sea.

Prior Coverage on this Blog