Saudi Arabia is Iran's greatest rival in the battle for regional hegemony. Their rivalry is being played out in Iraq, Lebanon, Bahrain and especially Syria - if Assad's regime falls, it could tip the balance of power.
The conflict between Sunni Saudi Arabia and Shiite Iran is exemplified by their relationship to Syria and Bahrain. Whereas the Saudis want Syrian ruler Bashar al-Assad to step down and are supplying the opposition with weapons, Tehran continues to support the president and has even reportedly sent special troops to crack down on the insurgency. The Lebanese Shiite militia, Hezbollah, which is largely funded by Iran, is also fighting with the Syrian regime.
However, Saudi Arabia is not supporting the insurgents because it wants democracy in the region. At the beginning of 2011, it sent its troops and tanks to Bahrain to help crack down on a popular Shiite insurgency against the autocratic Sunni ruling family. Tehran protested and called on Bahrain's Shiites to continue their insurgency.
Rivalry exacerbated by Arab revolutions
The Saudi-Iranian rivalry for regional hegemony is not new but it is now being played out more openly in more and more parts of the region.
"The Arab Spring has just accelerated a movement that we have been observing since around 2003," says Guido Steinberg, a Middle East expert at the German Institute for International and Security Affairs.
There are numerous reasons for the rivalry. Both countries are geopolitical heavyweights. With its ultra-conservative reading of Islam, Wahhabism, Saudi Arabia considers itself a key Sunni state and the guardian of Islam's most important holy sites. The official religion of Iran, on the other hand, is Shia, or Shiite, Islam. Both states are also important exporters of crude oil. Whereas Saudi Arabia is part of a strategic alliance with the US and other Gulf states, Iran cooperates with Russia, North Korea and Venezuela.
Suspicion of Iran's increased influence
Steinberg blames the US invasion of Iraq and the overthrow of Saddam Hussein, who was Sunni, for today's exacerbated rivalry between Iraq and Saudi Arabia. "The Saudis didn't see this in any way as a liberation of the country - but as a handover of Iraq to Iran."
Iran's influence in Iraq has indeed increased since the overthrow of Saddam Hussein and the Shiite majority has gained power. Leading Shiite politicians such as Prime Minister Nouri al-Maliki are in close contact with Tehran. There are political parties supported by Iran. The Iraqi security forces are partly trained in Iran.
Saudi Arabia is not alone to look on with suspicion. "Many Sunnis and their governments consider this the rise of an antagonistic denomination," says Steinberg. At the end of 2004, Jordan's King Abdullah II warned against a "Shiite crescent" in the region that included Iraq, Syria and Lebanon, where Hezbollah has been a state within a state for decades.
The concerns of the Saudis and others are motivated by domestic politics. In many of the region's predominantly Sunni states, there are Shiite minorities - between 5 and 10 percent in Saudi Arabia alone. Governments fear Iran could instrumentalize these minorities. This view was propagated by a commentary published on Al Jazeera's online page which said that Iran wanted "to spread Shiite domination. It's defending and supporting Shiites in all countries, aiming not only to make Iran a political heavyweight in the region but at international level."
'Cold war' in the Middle East?
Such fears are strengthened by Iran's nuclear program. Saudi Arabia is reacting by buying more and more weapons. According to the Stockholm International Peace Research Institute, Riyadh's military expenditure rose by 12 percent last year. Saudi Arabia is not known to have nuclear weapons yet. "But as soon as Iran has the capacity to build a bomb, the Saudis will act," prophesies Steinberg, warning of a "cold war" in the region. The London-based international newspaper, "Asharq Al-Awsat" which is funded by Saudi money, recently wrote that "Iran was conducting a cold war against Arab countries" and that this was a "concrete strategic part of Iranian foreign policy."
On top of concrete geo-strategic interests comes historical rivalry between Arabs and Persians, plus the tension between Sunni and Shiite Islam that goes back almost 1400 years. "The denominational conflict always needs a political detonator," says Steinberg. "Asharq Al-Awsat" expresses the Saudi view when it explains that Ayatollah Khomeini wanted to export the Shiite model of the Islamic revolution with arms and violence, whereas today's rulers are pursuing the same aim "with subtle methods."
But Saudi Arabia is also playing the denominational card offensively by supporting the Sunni minority in Lebanon and Sunni opposition in Syria. It's an easy calculation. The weaker Iran is - through the overthrow of al-Assad, for example - the stronger Saudi Arabia will be even if it still has to compete with states such as Qatar and Turkey in the Sunni camp.
Steinberg says that the political systems of Iran and Saudi Arabia which are officially based on religion are exacerbating conflict. "If nothing fundamental changes, the conflict will continue for a long time and will have an impact on other states."