Arab governments reportedly tell Washington they fear a bad deal with Iran will cause a nuclear arms race in the Middle East.

Arab governments have been privately expressing their concern to Washington about the emerging terms of a potential nuclear deal with Iran, The Wall Street Journal reported Friday, citing Arab and U.S. officials involved in the deliberations.

According to the report, the direction of American diplomacy with Tehran has added fuel to fears in some Arab states of a nuclear-arms race in the region, as well as reviving talk about possibly extending a U.S. nuclear umbrella to Middle East allies to counter any Iranian threat.

The major Sunni states, including Saudi Arabia, Egypt, the United Arab Emirates and Qatar, have said that a final agreement could allow Shiite-dominated Iran, their regional rival, to keep the technologies needed to produce nuclear weapons, according to these officials, while removing many of the sanctions that have crippled its economy in recent years.

Arab officials said a deal would likely drive Saudi Arabia, for one, to try to quickly match Iran’s nuclear capabilities, according to The Wall Street Journal.

“At this stage, we prefer a collapse of the diplomatic process to a bad deal,” an Arab official who has discussed Iran with the Obama administration and Saudi Arabia in recent weeks told the newspaper.

The Obama administration initially said its policy was to completely dismantle Tehran’s nuclear infrastructure as a means to protect Washington’s Mideast allies.

Now, however, officials say it is no longer plausible to eliminate all of Iran’s nuclear infrastructure, suggesting that any final deal would leave some nuclear capability in place.

According to The Wall Street Journal, Arab officials have increasingly spoken about a possible nuclear arms race in the Mideast as the negotiations have continued for 18 months, having been extended twice.

U.S. officials have declined to publicly disclose terms of the deal being negotiated with Iran. But they stress that they have closely consulted with Washington’s Arab allies about the diplomatic process.

The Obama administration believes an agreement with Iran will curtail the potential for a nuclear arms race in the Mideast, rather than fuel one.

“Only a good negotiated solution will result in long-term confidence that Iran won’t acquire a nuclear weapon,” a senior American official was quoted as having said.

“Given Iran already has the technical capability, our goal has always been to get to one-year breakout time and cut off the four pathways under a very constrained program,” added the official.

Given the concerns of Arab allies, the White House may need to provide them with greater security guarantees if it concludes a deal that stops short of dismantling Tehran’s ability to produce nuclear fuel, some former U.S. officials told The Wall Street Journal, citing the possible need to place Arab states in the Persian Gulf under the U.S.’s nuclear umbrella.

“It will be destabilizing to our friends and allies,” Stephen Hadley, a national-security adviser to President George W. Bush , said at a February 11 conference hosted by the Atlantic Council, a Washington think tank. “They will probably, in any event, hedge, in trying to have their own nuclear programs.”

The White House has stressed its policy isn’t to contain Tehran, but to deny it the capability to produce atomic bombs, making a formal defense pact unnecessary. But the talks have stoked regional anxiety, and Arab officials have held discussions about a possible nuclear umbrella with former U.S. officials and academics within recent weeks.

Arab governments have steered clear of aligning their statements with Israel, but share many of that country’s fears, U.S. and Arab diplomats said.

Prime Minister Binyamin Netanyahu, who has been perhaps the most vocal critic of the deal with Iran, said last week that Israel knows the details of the planned nuclear deal with Iran and warned that it is a bad one.

"I think this is a bad agreement that is dangerous for the state of Israel, and not just for it," said Netanyahu, adding, "If anyone thinks otherwise what is there to hide here?"

State Department spokeswoman Jen Psaki later questioned whether Netanyahu indeed knows “more than the negotiators” about the talks, saying “there is no deal yet.”

"Obviously, if there's a deal we'll be explaining the deal and explaining why and how it prevents Iran from acquiring a nuclear weapon. And if that's the case and we come to a deal, it's hard to see how anyone wouldn't see that's to the benefit of the international community," added Psaki.

The Obama administration has acknowledged that Iran will be allowed to maintain thousands of the centrifuge machines used to produce nuclear fuel as part of any final deal. Saudi Arabia, the UAE and others have argued these machines should be completely dismantled, since the centrifuges could be used for both civilian and military purposes.

Despite sharing Israel’s concerns about an Iran deal, Arab leaders haven’t tempered their calls for the U.S. to also address Israel’s suspected nuclear weapons arsenal, noted The Wall Street Journal.

While Arab countries are not publicly aligning their position with Israel, there were reports in recent months, mostly based out of Iran, that Israel was collaborating with Saudi Arabia against Iran’s nuclear program.

Iran’s accusations came in a series of Iranian media reports claiming, among other things, that the head of the Saudi intelligence service met with several senior Israeli security officials and that a Saudi Arabian delegation flew to Israel for meetings with high-ranking Israeli officials, including Netanyahu.

An earlier report said that Israel and Saudi Arabia had teamed up to launch a virus against Iran’s nuclear program.