Yasser Al-Qahtani scored from the penalty spot in the 13th minute to help Saudi Arabia overcome Iraq 1-0 and secure their place in the last four.
Saudi Arabia finished on top of Group B with seven points while Iraq left in third place on four points.
Elsewhere, Bahrain came from behind to earn a hard-fought 2-1 victory over Qatar.
Salman Aissa's goal for Bahrain just before the interval cancelled out Khalfan Ibrahim's opener in the 19th minute.
Bahrain star Alaa Hubail notched home what proved to be the winner just one minute into the second-half.
The victory put Bahrain in second place of the group with four points, leading Iraq on goal difference while Qatar lie at the bottom with just one point.
Oman face Bahrain and Saudi Arabia take on UAE in the competition's semi-final on Saturday.