The proxy war between Saudi Arabia and Iran escalated on Tuesday afternoon when Iranian backed Yemeni Houthis attacked the Saudi border town of Najran. The assault occurred shortly after an informal summit of the six members of the Gulf Cooperation Council (GCC) convened in Riyadh. The meeting was also attended by French President Francois Hollande who had arrived in Saudi Arabia hoping to defuse GCC fears of “the Iranian threat” ahead of a final deal between Iran and the West over Tehran's nuclear programme, expected to be signed in July. Reuters reported that the Saudi-led military coalition has warned it will hit back. An Egyptian official who spoke to Al-Ahram Weekly in Cairo said high-level contacts with Riyadh are underway in an attempt to hammer out a collective reaction to “this very serious development”. Egypt is part of the limited coalition that began launching air strikes on Yemen on 26 March in an attempt to check the advance of Iranian backed Houthis who contest the authority of the Saudi-backed Yemeni president Abd Rabbu Mansour Hadi, currently in exile in Saudi Arabia. Saudi Arabia's Al-Ekhbariya state television channel broadcast images of parked cars with windows blown out, chunks torn out of pavements and buildings peppered with shrapnel. The attack was confirmed by the coalition. Brigadier General Ahmed Al-Assiri told Al-Ekhbariya that the Houthis had “randomly” shelled Najran, “hitting hospitals, schools and civilian homes”. Schools have been closed in the town and Saudi papers report all local flights to Najran have been suspended. According to Al-Assiri “air and ground forces will respond appropriately to this dangerous development and will not allow it to be repeated”. “This is now an open-ended conflict that is likely to escalate,” said a Cairo-based European diplomat who spoke to Al-Ahram Weekly following the attack on Najran. “This attack confirms that the conflict in Yemen will be a long one and will draw in all parties in the region. We warned our friends in Saudi Arabia that it was going to be complicated and those warnings are proving true.” Yemen is only one, albeit the most explosive, of the fronts where the Saudis, whose diplomats insist Riyadh is facing “an existential threat posed by Iranian expansionism”, is fighting Tehran's growing regional influence following decades of diplomatic isolation. Despite official denials from the Saudis and their allies, and from the Iranians, it is an open secret that both have now a direct presence in Yemen. Earlier this week Saudi Arabia began preparations for an incursion by ground forces to help troops loyal to Hadi. Troop movements began on Sunday, leading Iranian officials to warn that Tehran would not sit idly by as its strategic interests were challenged and Yemenis denied “humanitarian assistance”. “Yemen is facing a humanitarian catastrophe. The Saudis promised to cooperate and allow humanitarian assistance. But to make any difference the humanitarian operation will have to be huge,” says a European diplomat. He argued that even if reports suggesting the Saudi-led coalition had used banned cluster bombs prove to be false the situation in Yemen will still be devastating. Whatever “humanitarian consideration” the Saudis were willing to show, before the attack on Najran, is significantly reduced now, suggested an Arab diplomat. He argues that “this attack confirms the worst fears, or let me say the worst nightmares, of the Saudis.” “They have been telling their allies in the Arab world and elsewhere that the attack on Najran is only the beginning of Iranian expansion which Tehran will pursue even more aggressively after the signing of a nuclear deal this summer.” Diplomatic sources in Western capitals say the Saudis are concertedly briefing that the Najran attack is the fault of Western lenience towards Tehran, and are demanding solid guarantees that Iran will not be allowed to destabilise regional security. In Riyadh Hollande was busy reiterating that Paris was not in the business of compromising Gulf security. Later this month GCC leaders are expected to demand that firm security guarantees are in place ahead of the signing of the nuclear treaty with Iran during a meeting scheduled with US President Barack Obama at the presidential retreat of Camp David. The GCC demands, say informed Arab political sources, include a “wider political regional deal” that includes Syria where the Iranian/Russian supported regime of Bashar Al-Assad is fast losing ground to troops funded by Saudi Arabia and trained by Turkey. The GCC will also seek an overhaul of political arrangements in Iraq and across the Arab Mashreq. “Iraq is an obvious front for Saudi-Iranian competition. It is at the centre of the tug of war between the two regional powers, a place where both Iran and Saudi Arabia find themselves supporting the Shia-led Iraqi government against ISIS,” commented an Iraqi politician. Whatever the security assurances or the political deal Riyadh may exact it is unlikely that the Saudis will become more relaxed about the “existential threat” posed by Iran, say Arab diplomats. Western diplomats agree that Iran is planning a strong comeback in Middle East affairs following years of isolation. “They have many cultural and economic gains to make. Tehran intends to become a regional superpower to reckon with,” says one Middle East based Western diplomat. He predicts that the tug of war between Riyadh and Tehran will continue “for a long time” and in a way that could force allies of each side into making unplanned military and political compromises. It might also, he says, create new political alliances “like the one we are seeing between the Saudis and Israelis” ahead of the signing of the Iranian nuclear deal. This, he argues, might end the by now very weak claim that the Palestinian cause is the central issue for the Arab World “once and for all”. “The Israelis tell us that the central issue for the Saudi-led Arab coalition now is Iran and I think they are probably right,” he says.