The BND issued the warning in a memo released Wednesday, adding that Riyadh is engaged in what it called regional competition with Iran.
Referring to Saudi policies vis-a-vis Iraq, Bahrain, Lebanon and Syria, the agency added that Riyadh is ready to take military, political and financial risks to ensure its influence in the region.
The memo added that under King Salman and his son Deputy Crown Prince Mohammed bin Salman, who is also Saudi Arabia’s defense minister, the country is trying to position itself as the leader of the Arab world.
Saudi Arabia started a deadly and relentless military aggression against its southern neighbor Yemen on March 26 without a UN mandate after King Salman came to power in January. The kingdom also has increased support for terrorist groups in Syria.
"The previous cautious diplomatic stance of older leaders within the royal family is being replaced by a new impulsive policy of intervention," the BND said, adding that the Saudis insist that Syrian President Bashar al-Assad must be removed from power.
The memo also warned that the concentration of economic and foreign policy power in Mohammed bin Salman is dangerous as “in trying to establish his position in the royal succession during his father's lifetime, he might draw the ire of other members of the royal family and the population with expensive measure or reforms, and also strain relations with friendly and allied states in the region."
Mohammed bin Salman, 30, was named second-in-line to the throne months after his father ascended to the throne, the appointment angered a few senior princes who criticized the decision.
The Brookings Institution, a Washington-based think tank, said in a September essay that the prince's "unbridled ambition has alienated many of his fellow princes," and that the 30-year-old has a reputation for “arrogance and ruthlessness."