May 20, 2017, U.S. President Trump signs an arms deal with the Kingdom of Saudi-Arabia worth of 460 billion dollar. A year later Trump abandons the Iran Nuclear Deal, undoing years of diplomatic effort and announces additional sanctions on the country. These strategic policy decisions wouldn’t be there without a relevant political context. Both Iran and Saudi-Arabia have aggressively been striving for influence in the region, resulting in an arms competition and various proxy-wars abroad. The question remains; why are these two states fighting each other and what are its consequences for the Middle-East?

With the instalment of Mohammed Bin Salam as the new crown prince of Saudi-Arabia, the country has become the centre of interest. The promised plans of MBS to modernize the highly conservative country have been received well, both domestically as in the West. But increasing controversies are plaguing the newly installed prince. By imprisoning five hundred princes and other government officials, he gave a strong message and consolidated the power of the royal family. The recent killing of Khashoggi – in particular – has shown the world another, more brutal side of the so-called reformist crown prince. Tensions are not only growing on the domestic level, but also in the region. Out of the sight of the news headlines, Saudi-Arabia and Iran have been expanding influence vis-à-vis each other for years. In order to understand the on-going rivalry, we first need to delve into the history of both countries and take into account their characteristics.

The Kingdom of Saudi-Arabia has been traditionally ruled by the Saud dynasty, having exclusive political power. However, they derive their legitimacy from the support of the clergy. This division between powers goes as far back as 1744. Back then, the founding fathers of Saudi-Arabia formed a pact with each other. Mohammed Bin Saud became the Emir and thus the political executive of the country and Mohammed Ibn Abdul Wahab was appointed the Imam of the Arab peninsula, being able to expand the fundamentalist Wahabi thought. Thus, the political executive authority was legitimized by approval of the Wahabi clergy. After the Arabs crushed the Ottomans, they named the territory after the ruling political family; Saud. When an American geologist discovered oil reserves in the country in 1938, the neo-patrimonial state became of high interest for the United States. American president Roosevelt met the Saudi King Abdul Aziz in 1945, designing a deal that provided post-war United States massive oil-reserves in return for security and arms for Saudi-Arabia. In 1975, the petrodollar was born, when oil reserves were used to back the dollar. Hence, the Saudi ‘black gold’ became the engine of the American capitalist world order. This geo-political deal signs the alliance between the two countries, with the core elements still enduring for a period of five Saudi kings and 12 U.S. presidents.

Iran, just like Saudi-Arabia, has been a country with massive oil reserves. But in contrast to their Arab counterpart, the country has experienced a history of political instability and foreign intervention of the Russians and British during the Qajar dynasty (1794-1925). When the popular politician Mossadegh became prime minister in 1953 he implemented a policy of nationalization of Iranian oil industry, which had been built and controlled by the British. The CIA and MI6 conducted a coup against Mossadegh and backed the monarch Mohammad Reza Pahlavi. The Sjah obtained absolute power and pursued a policy of aggressive modernization and oppression, but the monarch was highly dependent on the U.S. and lost its legitimacy after the coup on Mossadegh. The Islamic Revolution in 1979 made an end to the monarchy and the country became ruled by the clergy led by Khomeini. This is were the frictions between the newly declared Islamic Republic of Iran and Saudi-Arabia started. First of all, in the 1970’s both Iran and Saudi-Arabia were backed by the United States. This geo-political order changed after the Islamic Revolution in 1979, with Iran isolating its oil industry from foreign investors. Moreover, Khomeini emphasized on popular Islamic legitimacy rule and openly opposed the idea of a monarchy and declared it as un-Islamic. Until then the Saudi’s claimed to be the leader of the Islamic world, now Iran was claiming the same. Iran’s political system thus became a threat for the status-quo power of Saudi-Arabia and led to uprisings in the country, resulting in the seizure of the Grand Mosque in Mecca by insurgents in 1979. Both Saudi-Arabia and the U.S. feared Iran’s strategy of exporting its revolutionary ideals in the region, and heavily backed Iraq during the eight year war with Iran. Moreover, Saudi-Arabia’s population is mostly Sunni while Iran’s population is overwhelmingly Shia. This last characteristic is of high importance as both rivals have been supporting militias and political elites in the region along this sectarian line.

One of the most significant but also most neglected example is the ongoing civil war in Yemen. The Arab world’s poorest country has now also become the stage of a bloody battlefield between the two rivals. While the Saudi-led coalition is financing and arming the government forces, Iran is supporting the separatist Houthi rebels in the South. Although all involving groups are found guilty of war crimes, the Saudi-led coalition tops the list with their indiscriminate airstrikes on schools, hospitals and harbours leading to a humanitarian crisis. According to the UN, 10.000 people have been killed since 2014 and more than three million people have seen no other choice than fleeing their homes. The situation is urgent, as 17 million Yemenis will face severe famine if they don’t receive humanitarian support immediately. Considering the many rebel groups and involved countries, all pursuing their own interest – even within the Saudi-led coalition – a soon end to this tragedy seems extremely unlikely.

But Yemen is not the only stage where the power play between these two countries have erupted. After the U.S. invaded Iraq in 2003, they didn’t have an alternative for the Saddam government. The absence of a government authority resulted in a power vacuum with Sunni and Shia militias fighting for power. Iran and Saudi-Arabia used these rebel groups to channel their influence. This trend of expanding influence and power through sectarian lines continued during the Arab Spring in 2011. Iran being a anti-status quo power, supported revolutionary groups. Saudi-Arabia, being a traditional status-quo power, supported the autocratic regimes in the Middle-East. In Lebanon the Saudi-Iranian power struggles has taken a different form. Prime-minister Hariri shocked his nation when he abruptly resigned from office on live television during his visit to Saudi-Arabia. Hariri spoke out against Iran-backed Hezbollah, that occupies several ministerial posts in the country. Many reports claimed that the Lebanese prime minister was kept hostage by the Saudi government and was forced to step down. But the confrontations are not only limited to reality-show politics and arming proxy-wars. In Syria for example, the Iranians have stationed their military to fight alongside Hezbollah and Saudi-Arabia is actively bombing in Yemen, both risking direct confrontation.

It is evident that the Cold War between Iran and Saudi-Arabia has caused chaos and instability in the Middle-East. As we have seen, both countries are striving to become the leader of the Muslim world through gaining power in the region, while civilians are bearing the brunt of the wars. The two countries don’t intend to face direct confrontation, but their involvement in so many actions makes them hard to oversee. With the military help of the U.S., Saudi-Arabia is secured from a strong position and military power to pursue its shared interests with the Americans. After the U.S. pulled out of the Nuclear Deal, Iran is risking to slip into international isolation again. However, Russia and China have traditionally been backing Iran and as the latter is on its way to become a highly powerful actor, the Cold War in the Middle-East may reach desert temperatures in the future.