Scoop: Palestinians gave Saudis list of what they want in Israel-Saudi peace deal

The Palestinian Authority's list of wants in any U.S.-Israel-Saudi Arabia mega-deal includes Israel giving it more control over certain areas of the occupied West Bank and the reopening of the U.S. consulate in Jerusalem, according to six U.S. and Israeli sources familiar with the issue.

Why it matters: The PA provided the list of possible deliverables to Saudi Arabia earlier this year — a sign that Palestinian President Mahmoud Abbas and his aides have decided to take a pragmatic approach to the U.S.-led talks, which could see Israel-Saudi normalization, to avoid a clash with Riyadh and leverage their position to get as much as they can from any deal.

• It's a shift from 2020, when the PA publicly and angrily criticized the United Arab Emirates and Bahrain over their signing of the Trump administration-brokered Abraham Accords that saw the two Gulf nations normalize relations with Israel.
• If the PA vehemently objects to the mega-deal, it will make it much harder for Saudi Arabia to gain any kind of public support at home and across the Arab world.

Behind the scenes: Senior Abbas adviser Hussein al-Sheikh, who is leading the consultations on the issue with Riyadh, gave Saudi national security adviser Musaed bin Mohammed al-Aiban the list of possible deliverables three months ago, according to the U.S. and Israeli sources.

• The Palestinians want Israel to agree to change the status of parts of Area C in the occupied West Bank, where Israel currently has full control, to Area B, where the PA has civilian control and Israel maintains security control.
• Such a step would expand the Palestinian Authority's footprint in the West Bank and allow for more Palestinian development.

The Palestinians' list also proposes the U.S. finally reopen its consulate in Jerusalem, which was closed by the Trump administration. President Biden vowed to reopen the consulate when he took office, but it remains closed amid Israeli opposition.

• The PA also wants Saudi Arabia to open a consulate in Jerusalem. Riyadh this year appointed its ambassador to Jordan as a non-resident consul general in Jerusalem.

The PA's list includes steps that it wants to be taken at the UN related to the recognition of Palestine as a member state.

• The Palestinians also asked Saudi Arabia to resume funding to the Palestinian Authority, which was halted several years ago. The Wall Street Journal reported on Tuesday that the Saudis are ready to do that.
• The Palestinians want Israel to agree to at least some of these steps upfront and agree to resume Israeli-Palestinian final status negotiations over several years under a clear timetable, the sources said.

• According to the sources, the Biden administration is aware of the content of the Palestinian proposals to the Saudis.
• Al-Sheikh didn't respond to questions about the list. The Saudi Embassy in Washington also didn't respond to Axios' request for comment.

The big picture: The Biden administration is pushing to get a mega-deal with Saudi Arabia and Israel before the 2024 presidential campaign consumes Biden's agenda.

• The White House made it clear to the Israeli government that it would have to make significant concessions to the Palestinians as part of such a deal with Saudi Arabia that includes normalization between the kingdom and Israel.
• But the administration faces an uphill battle. Israeli Prime Minister Benjamin Netanyahu has strong reservations about taking any significant steps toward the Palestinians. Doing so would likely anger the extreme-right parties that are part of his coalition and risk bringing down his government.

State of play: Barbara Leaf, the State Department's senior Middle East diplomat, met al-Sheikh in Jordan earlier this week. Palestinian intelligence chief Majed Faraj and Abbas' foreign policy adviser Majdi al-Khaledi also attended the meeting, according to a statement by al-Sheikh.

• Al-Sheikh is expected to travel to Saudi Arabia next week to continue the discussions with the Saudis on this issue.