The new Saudi leadership team will be at the center of global attention when it hosts U.S. President Barack Obama and Gulf Arab leaders this week. King Salman and his powerful son have led a series of significant policy changes on both the domestic and the international stage since taking office in early 2015.

In this Q&A, Carnegie scholars explore the foreign policy activism Riyadh has displayed over the past year. They demonstrate how this reveals anxieties about the future of the ruling family and serious domestic challenges as much as a response to a region in turmoil.

What has been the impact of last year’s leadership transition on Saudi Arabia’s foreign policy?

Frederic Wehrey Frederic Wehrey is a senior fellow in the Middle East Program at the Carnegie Endowment for International Peace. His research deals with armed conflict, security sectors, and identity politics, with a focus on Libya, North Africa, and the Gulf. More >

Frederic Wehrey: King Salman’s accession to the throne has resulted in a break with the somewhat cautious, deliberative, behind-the-scenes maneuvering that characterized his predecessor, King Abdullah.

The so-called Salman Doctrine has been marked by a more assertive and militarized approach to regional conflict, the centerpiece of which has been the Saudi-led intervention in Yemen. A standard interpretation holds that this adventurism stems from Riyadh’s frustration with what Saudis see as the United States’ retreat from the Middle East and especially its tacit complicity in Iran’s aggressive behavior after the nuclear accord.

But Saudi foreign behavior is also deeply rooted in an unsettled domestic context. A new generation of princes, headed by King Salman’s son, Deputy Crown Prince Mohammed bin Salman, now vie for the mantle of the kingdom’s leadership. Already, Mohammed bin Salman has amassed extraordinary domestic power, using the Defense Ministry portfolio and his oversight of Saudi military operations in Yemen to cultivate something near a cult of personality, as well as a wave of Sunni-based Saudi nationalism. The deputy crown prince is also overseeing the formation of an alliance to purportedly liberate Raqqa, Syria, from the self-proclaimed Islamic State—operationalizing this campaign, however, is another matter, and the alliance’s real benefit may be for domestic consumption.

At the same time, looming economic challenges stemming from sustained low oil prices are forcing a recalibration and retrenchment of Saudi Arabia’s hitherto aggressive regional footprint.

Overall, a series of erratic and in many cases counterproductive swings in policy under King Salman and his headstrong son are not signs of a confident state. Rather they are the outward projection of a troubled dynasty’s anxieties about succession and looming social and economic challenges, along with an array of regional threats.

What is the state of the U.S.-Saudi relationship?

Perry Cammack Perry Cammack was a nonresident fellow in the Middle East Program at the Carnegie Endowment for International Peace, where he focuses on long-term regional trends and their implications for American foreign policy. @perrycammack

Perry Cammack: This is a testy moment for the U.S.-Saudi relationship. It is true that some of the tensions are ​​cyclical, and the next U.S. president is not likely to share President Obama’s detached temperament, to which Gulf leaders have struggled to adapt. Mohammed bin Salman, who remains something of an enigma to the West, may develop closer ties with his foreign interlocutors over time.

But those hoping that a new president in Washington can bring a return to the old paradigm, whereby the United States provided for the kingdom’s security in exchange for stability in the global energy markets, will likely be disappointed. The United States is no longer so dependent on Saudi oil, and the American public has no desire to return to a regional policeman role. Meanwhile, the Saudis feel abandoned, and even betrayed, by Washington’s tentative engagement with Tehran.

Obama’s recent reference to the Gulf countries as free riders in his extensive interview with Jeffrey Goldberg of the Atlantic was viewed as a major snub in Riyadh. But the episode helped highlight that both countries actually agree that Saudi Arabia has become overly dependent upon the United States for strategic security as part of the oil-for-security arrangement.

It is tough to see how the two sides can effectively redress this situation when they have such different views of how to salvage what is left of the collapsing regional order. Washington is uneasy about the Saudi-led intervention in Yemen, while Riyadh sees the United States as abdicating its traditional regional role, particularly in Syria, to Iran’s benefit.

A new normal in relations may be emerging, however, where both sides publicly point to the many aspects of continuing security and economic cooperation, even as they privately, and not so privately, disagree on the diagnosis of the region’s many crises.

What has been the impact of low oil prices on Saudi Arabia’s economy and position in the global market?

David Livingston Livingston was an associate fellow in Carnegie’s Energy and Climate Program, where his research focuses on emerging markets, technologies, and risks. More >

David Livingston: Before touching on impact, it is important to recognize that current low oil prices are in significant part the result of Saudi Arabia’s decision to pursue market share over price stability. This move was first signaled at the November 2014 OPEC meeting, and the strategy has borne fruit by increasing Saudi Arabia’s global market share and forcing the suspension of higher-cost oil projects around the world.

However, this is not entirely positive news for Riyadh. Saudi Arabia is running a budget deficit of around 15 percent, and losing multiple billions in net foreign reserves every month in order to defend the riyal’s peg against the dollar. Riyadh can afford to continue to bleed its coffers at this rate for at least a few years to come—as of April 2016, the International Monetary Fund values Saudi Arabia’s foreign assets at $592 billion—but not without increasing international scrutiny of the sustainability of both the Saudi economic model and Riyadh’s historical preeminence in the global oil market.

Saudi Arabia has actually been losing market share where it matters most, including key hubs of future demand growth such as China, India, and the United States. Riyadh’s entrée into these markets is threatened by Tehran’s aggressive discounting; Iran is seeking to return to the global market at any cost to reassert what it views as its traditional role.

How are developments affecting Saudi Arabia’s relationships with Egypt, Jordan, and Yemen?

Marwan Muasher Muasher is vice president for studies at Carnegie, where he oversees research in Washington and Beirut on the Middle East. More > @MarwanMuasher

Marwan Muasher: The dramatic drop in oil prices in the last two years means that Saudi Arabia will be hard pressed to exercise its influence with regional states such as Egypt and Jordan through its traditional financial handouts to these countries.

While the new administration is taking steps such as privatizing part of its oil company, Aramco, raising fuel prices, and even potentially borrowing money, it is expected that it will use additional income to largely offset its domestic budget deficit rather than keep the current levels of funding going to Egypt and Jordan. Saudi Arabia is also expected to turn most of its aid into loans rather than outright grants. For instance, Riyadh is now focusing on petroleum subsidies to Egypt that Cairo will have to pay back with interest.

This will have significant economic impact on these two countries; Egypt and Jordan are both struggling economically. But even so, this change might force them to enact needed economic reform measures they are so far reluctant about.

The war on Yemen has already cost the Saudis an estimated $5.3 billion, a staggering figure given Saudi Arabia’s current financial problems. The Saudis are thus likely to push for a political settlement in that country sooner rather than later, with signs of that already taking place.

Part of the Saudis’ pursuit of a more aggressive foreign policy includes expecting their traditional allies to be more in line with their own position. As such, there are signs of tensions below the surface with Jordan and Egypt over differences regarding how to deal with the Syrian crisis, Iran, and the Muslim Brotherhood. King Salman’s recent visit to Egypt, for example, was likely meant to bring Cairo into line on Yemen—where Egyptian President Abdel Fattah el-Sisi has not followed through on pledges of military support—and on Syria, where the Egyptian president’s strong ties with Russian President Vladimir Putin have angered Riyadh.

What are the prospects of rapprochement between Saudi Arabia and Iran?

Karim Sadjadpour Karim Sadjadpour is a senior fellow at the Carnegie Endowment for International Peace, where he focuses on Iran and U.S. foreign policy toward the Middle East. More > @ksadjadpour

Karim Sadjadpour: Very unlikely in 2016. The Saudi-Iranian conflict is a geopolitical proxy war cloaked in ethnic (Arab-Persian) and sectarian (Sunni-Shia) disputes. It’s a vicious cycle: clashing regional ambitions ignite jingoism and identity politics in both nations, which further aggravates their geopolitical differences.

Saudi Arabia has spent tens of billions of dollars trying to counter Iranian influence in the region, with mixed results. Syria, Lebanon, and Iraq remain in Iran’s sphere of influence, and Riyadh’s military campaign against the Iranian-allied Houthi movement in Yemen has caused mass civilian casualties and fueled radical groups like al-Qaeda. Only in Bahrain has Saudi Arabia maintained a clear upper hand, though at great reputational cost.

While Tehran and Riyadh share a common interest in countering the Islamic State, they blame each other for fueling it. For Tehran, the Islamic State is the offspring of Wahhabi ideology (the version of Islam native to Saudi Arabia) and Saudi funding, while Riyadh sees the group’s emergence as a by-product of Iranian-backed repression of Sunni Arabs in Syria and Iraq.

Up until now purported efforts by Iranian Foreign Minister Mohammad Javad Zarif and various third parties—including the United States—to facilitate a Saudi-Iranian détente have been unsuccessful. Riyadh questions Iran’s sincerity and seemingly believes it needs to regain regional leverage in order to strengthen its negotiating position. What’s more, though Saudi Arabia’s efforts to counter Iran have been costly and injurious, they’ve been politically popular at home.

A combination of exhaustion and depleting oil revenue will eventually force Saudi Arabia and Iran to seriously negotiate. But that day doesn’t appear near.

How do you assess Saudi Arabia’s policies with respect to Syria and Lebanon?

Joseph Bahout Joseph Bahout was a nonresident fellow in Carnegie’s Middle East Program. His research focuses on political developments in Lebanon and Syria, regional spillover from the Syrian crisis, and identity politics across the region. More > @jobahout

Joseph Bahout: Riyadh’s desire to roll back Iran’s influence was a key driver of the decision to support the Syrian uprising against the Bashar al-Assad regime, even at the cost of enhancing its militarization and the rise of a myriad of Salafi-inspired groups.

With the conflict in Syria now almost exclusively managed by a Russian-U.S. willingness to push the political process forward, Saudi policy has very grudgingly adapted. While Saudi Arabia still voices its desire to see Assad ousted, it supports and caters to the opposition delegation negotiating with the regime in Geneva. Riyadh also hopes that Moscow’s influence in Syria will, with time, supplant that of Tehran.

The same anti-Iranian rationale tends to subsume Saudi policy toward Lebanon. Riyadh has for a long time backed former prime minister Saad Hariri and his allies, encouraging them to stay firm against the Iranian archenemy represented by Hezbollah, even when both groups have been engaged in national unity governments. However, the continuing lack of an effective government in Beirut, as well as what Riyadh perceives as the growing political strength of Hezbollah, has seemingly been the driver of a sudden and surprising shift in policy. In early 2016, Saudi Arabia cut all aid to the Lebanese army, and threatened to directly or indirectly reduce other support for the Lebanese state and economy. There is no doubt that this move is a double-edged sword, however, as the measures further weaken Saudi allies and interests in the country.

What is Saudi Arabia’s nuclear calculus?

Tristan Volpe Tristan Volpe is a nonresident fellow at the Carnegie Endowment for International Peace and assistant professor of defense analysis at the Naval Postgraduate School. More > @teeandersvolpe

Tristan Volpe: The Saudi leadership is considering nuclear energy as a hedge against the future trajectory of Iran’s nuclear program, and also to help meet an increased demand for electricity and desalinated water.

The King Abdullah City for Atomic and Renewable Energy is responsible for advancing a nuclear energy plan, but the only progress made so far has been a slew of exploratory agreements signed with the leading suppliers of nuclear technology. In contrast to the steps taken by the United Arab Emirates to begin construction on a large nuclear reactor project, Saudi Arabia is not urgently moving to translate its aspirations for nuclear energy into operational capacity.

In the wake of the Iran nuclear agreement, there is little pressing reason to sprint down the ruinous path of emulating the Iranian enrichment capability. Instead, as former Saudi ambassador to the United States Prince Turki al-Faisal underscored, the agreement provides breathing room for his nation to develop its own civil nuclear program so that by the time the key constraints on Iran’s nuclear program expire, “We should be in full stride in terms of human capacity for our own development of peaceful uses of nuclear energy.”

Alongside this, Saudi officials use the threat of an atomic arms race with Iran as a bargaining chip to gain leverage over the United States. During the 2015 Camp David summit, for instance, the Saudis played up the prospect of matching Iran’s nuclear capabilities in a failed bid to pressure the Obama administration for enhanced military support and a formal defense treaty. As the U.S.-Saudi relationship continues to evolve, the kingdom’s desire to maintain and augment U.S. support will be a critical driver of the Saudi nuclear strategy.