Ok, despite everyone's complaints I constantly find the diplomacy in this game surprisingly sophisticated...

I'm playing as the Moors and I've managed to remain at peace with everyone while building up a strong army by simply reinforcing Cordoba every turn while campaigning against Timbuktu and the province to the west of it. Meanwhile my diplomat has been travelling the world establishing trade rights and alliances with anyone and everyone he can.

I had managed to get him all the way to Byzantium and made an alliance with them (Already managed alliances with Portugal, Spain, France, England, the HRE, Milan, Venice, the Papal States, and Sicily) and then I decided I should send him down to the Turks and Egypt since I don't have alliances with my Islamic brethren just yet. I didn't realize that Byzantium was at war with the Turks at the time... but when my diplomat arrived at the nearest Turk controlled city I noticed some Byzantine campaign armies in the region and realized I wasn't likely to be able to make alliance with the Turks due to the conflict. Still, I thought I'd establish trade rights at least, since the Turks control some lucrative port cities...

To my surprise alliance was one of my possible offers, so I made my standard alliance and trade rights in exchange for map information offer, and they accepted, and the war between Byzantium and the Turks ended.

So... Basically I just negotiated a ceasefire between two other factions :)