As Obama begins his second term, this article takes stock of his foreign policy approach towards the Middle East. It lays out four big arguments. First, Obama's foreign policy in the Middle East has demonstrated more continuity with the past than real change. While shifting his approach significantly from Bush's, Obama has adopted a centrist–realist approach towards the region, consistent with the dominant US foreign policy orientation. Second, from Palestinian–Israeli peace to Afghanistan, Obama's conduct testifies to the structural–institutional continuity of US foreign policy. More than in any other region in the world, presidential policy in the Middle East is hampered by institutional, bureaucratic and domestic politics. America's dysfunctional political culture has imposed severe constraints on Obama's ability to pursue an even-handed approach towards the enduring and preeminent Palestine question. Third, despite Obama's lofty rhetoric about a new start in relations between the United States and Muslim countries, the Middle East does not rank very high on his agenda. Putting America's fiscal house in order and renewing its long-term economic strength have been Obama's priorities. From the outset, Obama has been shifting US foreign policy priorities away from the Middle East to the Pacific and Asia where he and his aides believe that America's future lies. Finally, the article argues that the US finds itself in a similar position to that of Great Britain after the Second World War, at the beginning of the end of its hegemonic moment in the Middle East. The end of American hegemony in the region stems from internal and external causes, including an awakened public opinion in the Middle East, the emergence of geostrategic and geo-economic regional powers with assertive foreign policies, America's relative economic decline and the high costs of war, and the shift in US foreign policy priorities to the Asia–Pacific region.