Saudi Arabia will be pleased that the furore over its execution of the Shia cleric Nimr al-Nimr is taking the form of a heightened confrontation with Iran and the Shia world as a whole. Insults and threats are exchanged and diplomatic missions closed. Sunni mosques are blown up in Shia-dominated areas of Iraq. The Saudi rulers are able to strengthen their leadership of a broad Sunni coalition against an Iranian-led Shia axis at home and abroad.

The motive for the mass execution of Sheikh Nimr and 46 others, many Sunni jihadists, was primarily domestic. The threat to the al-Saud family within Saudi Arabia comes from Sunni extremists in al-Qaeda and Isis and not from the Shia, who are only a majority in two provinces in the eastern region of the country. Furious denunciations by Shia communities and countries will do nothing but good to the reputation of the ruling family among the majority of Saudis.

Saudi Arabia and its fundamentalist Wahhabi variant of Sunni Islam has been blamed by many outside the kingdom as the ideological forbearer of Isis, but the real danger for the monarchy is that it should be seen at home as insufficiently zealous as defender of the faith.

Denouncing the recently announced Saudi-led anti-terrorist coalition, the self-declared caliph, Abu Bakr al-Baghdadi said that if it was truly Islamic it would go to war against Syrian President Bashar al-Assad and his Russian masters and make its objective “killing Jews and the liberation of Palestine.” In the face of this there is nothing very surprising about the Saudi government playing the sectarian and patriotic cards for all they are worth.

All the same, there is a growing suspicion in the Middle East and beyond that the Saudi royal family is losing its traditional political touch which enabled it to survive over the past 70 years when other monarchies, along with once-powerful socialist and nationalist regimes, have long ago disappeared.

It seems to have lost its old caution and is plunging into political snake pits without much idea of how it is going to get out of them.

Over the past year the Saudis have overplayed their hand, backing local allies and proxies in Syria and Yemen who are never going to win decisive victories. Part of this may be a Saudi over-reaction to the agreement between the US and Iran on the Iranian nuclear programme. The fall in the price of oil leading to an austerity budget has increased the incentive to beat the patriotic and religious drum in order to promote national solidarity in face of growing challenges.

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Prospects for a more active Saudi role may have looked rosier in the first half of 2015. Along with Turkey, it gave backing to an offensive in northern Syria by the Army of Conquest, a coalition of Sunni rebel groups led by the al-Qaeda affiliate the al-Nusra Front and the ideologically similar Ahrar al-Sham. This won a series of victories against the Syrian army, but ended up by provoking Russian military intervention on 30 September, which makes it unlikely that Saudi Arabia will achieve its aim of overthrowing President Assad.

The Saudis most powerful ally among the armed opposition, Zahran Alloush of Jaysh al-Islam, was killed by a missile on 25 December. The increasing strength of other players, such as Russia and the Syrian Kurds, is reducing Saudi influence, but there is no sign of its policy being redirected.

At about the same moment, the Saudis started their air campaign against the Houthi movement in Yemen, which is still going on 10 months later with no sign of the war ending.

The Saudis claimed that the Houthis were Iranian stooges, an accusation that was always exaggerated, but may be self-fulfilling as Yemen becomes increasingly split along Shia-Sunni lines. As with Afghanistan, Yemen is easy to invade but difficult to get out of as the Houthi leadership shows no sign of giving up. With no peace in sight, Riyadh faces the prospect of the Yemen war becoming a permanent running sore.

Saudi Arabia’s entanglement in the conflict in Yemen limits its ability to exert influence elsewhere. Even Saudi resources are under strain given the low price of oil with this year’s budget totalling $137bn (£93bn) and spending $224bn (£152bn). “Thanks to the over-confidence and under-competence of the Saudi royal family,” writes Aron Lund of the Carnegie Endowment for International Peace in the online newsletter Syria Comment. “Syrian rebels may turn out to be among the biggest losers of the Yemeni war.”

Saudi rulers have faced serious challenges before, but they have never been faced with the degree of instability in states surrounding or close to the kingdom. There are wars in Iraq, Syria and Yemen, a guerrilla conflict in Sinai and street protests in Bahrain that could always become more serious. It should be much in Saudi Arabia’s interest to mitigate these crises but instead it stokes them but without any real plan on how to bring them to an end.