Saudi Arabia maintains its firm, publicly reiterated condition that formal diplomatic relations with Israel require an irreversible pathway to an independent Palestinian state with East Jerusalem as its capital, a stance unchanged since the Gaza war and reinforced by Crown Prince Mohammed bin Salman and Foreign Minister Faisal bin Farhan. Domestic polling shows near-universal Saudi opposition to normalization, while recent U.S. efforts to tie a civilian nuclear agreement to Abraham Accords accession have not altered Riyadh’s position. Ongoing regional tensions, alternative Saudi defense alignments with Turkey, Pakistan, and Egypt, and the absence of Israeli concessions on Palestinian statehood have kept talks stalled. With only months remaining before 2027, these structural barriers underpin trader expectations against near-term normalization.