France lost its position in the Middle East after it proved itself "unreliable" to the Israelis by refusing to supply weapons during the 6 day war and after, they wanted the Israelis to pull out of the west bank et all first.
The Americans had no such compunctions, and pursued a policy which clearly favored the Israelis. France found itself squeezed by the 2 superpowers who began to dominate the region. Once the the Arabs fell out of love with Arab nationalism (and the USSR) it was natural for them to cultivate there new protectors by buying there weapons.
Indeed it is a main stay of Saudi foreign policy, they buy everyone's weapons, the most expensive and up to date, in an attempt to keep all there burly protectors sweet. It has little to do with defense.
America as Rich states only sells to countries that are not a threat, reasonably enough. There arms sales, like most countries arms sales, are a huge moral black spot. Although I'm pissing in the wind here I'm going to say it again, selling weapons to make a profit is unworthy of any country with considers itself a modern democracy, it is morally repugnant and economically unsound. And a fairly recent phenomena, I'm not opposed to all weapon sales by any means, selling to your true allies, not a problem. Its the selling of weapons to every mean and cruel little dictorship and banana republic that comes knocking that makes me sick. Britain, the USA, France, Germany, Italy, are all trying to out do each other in the moral confusion stakes.
It is a testimony to the arms industry that a forum devoted to the military and stratgy discusses real war only infrequently, it's main topic of discussion seems to be the cash register of arms sales.
The real wars wars that are been fought barely merit a mention, doesn't anyone else find this strange?