Insurgents stormed the heavily fortified US consulate in Jedda on Monday, killing five non-American staff members, before Saudi forces shot dead three attackers and captured two to regain control.
Toby Jones, a Saudi Arabia analyst with conflict resolution organisation International Crisis Group, said the attack was proof the Saudis cannot defeat the insurgents by force alone.
"The nature of the attack proves militants still have the capacity to strike a major target once in a while," he told Aljazeera.net.
"This was a heavily fortified target which would have been on red alert. So the attack must have been well planned and well executed.
"The insurgents haven't got the operational capacity to mount daily attacks like we are seeing in Iraq, but I think we will continue to see regular low level attacks and the occasional big attack."
However, Jones warned that the insurgents' strength should not be overestimated.
Crown Prince Abd Allah's ruling
family calls insurgents 'terrorists'
"The regime says it has snuffed out the threat of the militants - and it is true that they have scored a number of successes.
"It is probably fair to say the militants are in a weakened positioned compared to a few years ago. They are certainly in no position to overthrow the monarchy."
The Jedda attack was the first major assault in Saudi Arabia in several months.
The Saudi government vowed to "hunt down terrorists until we uproot them and cleanse society of them", an official statement said on Monday.
Riyadh says the insurgents are murderers who threaten national stability and who enjoy little grassroots support.
The royal family has pledged to politically reform the country, but at its own pace and in accordance with Islamic principles.
Despite this, analysts say the fighters do represent deeply-held grievances widespread in society even if most Saudis disagree with their violent methods.
They say insurgents are motivated by perceived Western injustices against the Muslim world, such as US support for Israel and the invasion and occupation of Iraq.
Many Saudis also feel the royal family is illegitimate, accusing it of dictatorship, widespread corruption and subservience to the West.
"There is no political freedom, the Saudi education system does not equip Saudis to get jobs, and there is unbelievable corruption. I think the Saudi system is breeding fanatics rather than rooting them out"
Mai Yamani, Royal Institute of International Affairs
Human rights groups have consistently condemned Saudi Arabia for gross human rights violations, acts of political violence and the imprisonment of political opponents.
Nevertheless, Jones said the Saudi regime is not the insurgents' main target.
"At the moment they seem to be targeting Western interests in the kingdom. That said, I think militant groups would love to see the monarchy overthrown. They see the Saudi regime as a Western client state in holy Islamic land."
Mai Yamani, a Saudi Arabia expert at London's Royal Institute of International Affairs, told Aljazeera.net that as long as the royal family remains in power, no real change will happen.
"No real reforms have taken place in Saudi Arabia despite all the rhetoric" she said.
"There is no political freedom, the Saudi education system does not equip Saudis to get jobs, and there is unbelievable corruption. I think the Saudi system is breeding fanatics rather than rooting them out."
The Saudis say they will wipe out
She added: "Most of the Saudi people do not want to see terrorism in their country. But when they see all the respected reformers being jailed they are left with no hope. So more violence is inevitable."
Toby Jones agrees.
"The Saudis must realise that there isn't an exclusive security solution to this situation. The International Crisis Group believes the Saudis must open up politically and address the grievances of their opponents. That is the way to combat extremism.
"But I think a consensus has prevailed among the Saudi establishment that political liberalisation will not satisfy the militants' demands.
"So an increasing reliance on security-based measures has taken root. This does not bode well for the future."