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Saudi Arabia and Israel normalisation would be a "big deal",ÌýUS National Security Adviser Jake Sullivan has admitted, but batted off reports that President Joe Biden and Saudi Crown Prince Mohammed bin Salman were due to meet to discuss the issue.

Sullivan admitted that such Israel-Saudi normalisation would be beneficial for the US but avoided questions on whether MbS and Biden will meet at the upcoming G20 summit in New Delhi.

The US has supported a normalisation agreement between the two states and played a key role in helping Israel establish ties with the UAE, Bahrain, Sudan and Morocco.

"Peace between Saudi Arabia and Israel would be a big deal. It would establish a more integrated, more stable Middle East region," Sullivan told reporters when asked about the reported MbS-Biden meeting.

"It would help create a circumstance in which the countries of the region, including those who have signed the Abraham Accords, Israel and Saudi could collaborate on everything from economics to technology to regional security.

"That would benefit the United States of America in a fundamental way because we have an interest in a more integrated, more stable Middle East where de-escalation as opposed to escalation is the [word] of the day."

MbS and Biden met in 2022 when the pair's famous "first bump" was widely talked about among analysts.

During Biden's election campaign, the Democrat pledged to make the kingdom a "pariah" following the murder of Saudi journalist Jamal Khashoggi and removed Yemen's Houthi rebels from a terror list shortly after taking office. Both events greatly angered the Saudis.

Since then, Biden has changed his stance on Saudi Arabia but Riyadh has opted for a foreign policy less reliant on the US. This includes a China-brokered normalisation agreement with Iran and the alleged refusal by Riyadh to ramp up oil production after Russia's invasion of Ukraine sent energy prices northwards.

Saudi Arabia has not followed its Arab and Gulf partners in recognising Israel, saying it wants concessions from the US and the establishment of an independent Palestinian state, although the latter option appears unthinkable under the current Israeli administration.

The US is reportedly ready to offer Riyadh a "mega-deal" to encourage normalisation and Biden could meet MbS in New Delhi to discuss this, according to Axios.Ìý

Among the possible sweeteners would be Saudi Arabia establishing a civilian nuclear programme with the ability to enrich uranium and a security agreement.