Saudi Arabia maintains its longstanding precondition that any normalization with Israel requires verifiable progress toward Palestinian statehood, a threshold that remains unmet amid stalled talks and the prolonged Gaza conflict. Riyadh has shown little movement on this demand despite technical-level discussions with Washington and Jerusalem, while domestic public opinion in the kingdom continues to register strong opposition. Recent reporting confirms that incremental confidence-building steps, such as expanded overflights or commercial contacts, fall short of formal diplomatic relations. Traders therefore assign an 83 percent probability to “No” before the December 31, 2026 deadline, reflecting the structural barriers and absence of any near-term catalyst capable of shifting Saudi policy.