The US also arms Israel, so as far as the arms companies are concerned it is a win win situation. As Israel will seek even more sophisticated arms to counter the percieved threat from Saudi Arabia. If Saudi Arabia has been sold J Dams it is only a matter of time before Qatar, Bahrain, and Kuwait ask for the same capability.
UN: At least 1,332 Iraqis killed by violence in July (AP)
from the article: Gates says Washington to sell smart bombs to Saudi Arabia