The Iran–Saudi Arabia proxy conflict (also known as the Arab–Persian conflict or Middle Eastern Cold War) is the ongoing struggle for regional influence between the two countries. The countries have provided varying degrees of support to opposing sides in nearby conflicts, including various civil wars.
From hot desert to cold war
The Middle East is one of the most complex regions in the world. Currently there are 
3 failing states, and 3 ongoing wars, with major powers increasingly taking sides. Countless armed militias and terrorist groups are continuing to spread violence across borders. The region has seen conflict after conflict, going back well into the 20th century. However, among all the uprisings, civil wars, and insurgencies, two countries always seem to be involved: 
Saudi Arabiaball and 
Iranball. They're bitter rivals, and their feud is the key to understanding conflicts in the Middle East.
While both have never actually declared war on each other, they instead fight indirectly by supporting opposing sides in other countries and inciting conflicts. This is known as proxy warfare, and it's had a devastating effect on the region. Countries, especially poor ones, can't function properly if there are other countries pulling strings within their borders. Both countries see these wars and conflicts, as both tremendous threats, and also potential opportunities. The Saudi-Iranian rivalry has become a fight over influence, and has made the whole region a battlefield. This is why the rivalry is being called a cold war.
History
The famous Cold War
The most famous cold war was fought for 40 years between the 
USAball and 
Soviet Unionball. They never declared war on each other but clashed in proxy wars around the world. Both sides supported dictators, and rebel groups, and intervened in civil wars to contain each other. Like the USA and the Soviet Union, Saudi Arabia and Iran are two powerful rivals, but instead of fighting for world dominance, they're fighting over control of the Middle East. In order to understand the Saudi-Iranian rivalry, let's go back to their origins
Saudi Arabia's backstory
In early 1900s, the Arabian peninsula was a patchwork of tribes, under the control of 
Ottoman Empireball. After World War I, the empire collapsed, leaving these tribes to fight each other for power. One tribe from the interior, the al-Saud, eventually conquered most of the peninsula with the decisive help of 
UKball that made an important ally in the region, and in 1932, it was recognized as the Kingdom of Saudi Arabiaball. 6 years later, after years of digging, massive oil reserves were found in its clay, and in an instant, Saudi was rich. That oil money built roads and cities around its desert country and helped forge an alliance with USAball that secured the protection of Saudi family rule in exchange for their oil.
Iran's backstory
On the eastern side of the Persian Gulf, another country was emerging, but having a much harder time. Iran, back then known as 
Qajarball, also had massive oil reserves and an even bigger Muslim population. Constant foreign intervention was creating chaos, however. 
Russiaball and UKball had invaded it twice, and in 1953, USAball secretly staged a coup, removing its popular prime minister, Mohammed Mosaddegh, and installing Reza Shah as its monarch, turning him into Pahlavi Iranball and close American ally. While in power, Reza Shah was aggressively forming Iran into a secular, westernized country. He harbored corruption and terrorized the population with his secret police, the SAVAK.
The Rivalry
By 1940, both Iranball and Saudi Arabiaball had oil based economies, and were both heavily backed by USAball. However, their feelings among both of them were very different. The Shah simply didn't have the same control over the Iranians, or ultimately the same legitimacy or affection, that the Saudis felt over their monarchy. Eventually, Iran's population got stifled by the Shah's reformations, and in 1979, they finally fought back.
Iran's Islamic Revolution was where the people of Iran overthrow the Shah and was where Saudi Arabia and Iran's real rivalry began. The Revolution was a massive international event that prompted reactions around the world, especially in Saudi Arabia. Iran's revolution terrified Saudi Arabiaball, as it feared it would inspire its population to do the same. While there was not only a revolutionary threat, but also a religious threat. Saudi Arabiaball's population is a majority Sunni, while Iran's population was a majority Shia. Saudi Arabia even claims itself the leader of the Muslim world, mainly because Islam's two holiest sites, Meccaball and Medinaball, lie in Saudi's clay. After its revolution, however, Iranball also claims to be the legitimate Muslim state. While the Sunni-Shia split was not a reason for the rivalry, it was an important division.
Eventually Saudi Arabia's fears came to life when Iran began exporting its revolution. Iran had begun to help groups, mostly Shia, try to overthrow governments in Iraq, Afghanistan, and Saudi Arabia, prompting Saudi Arabia to redouble its efforts to fight Iran. It bolstered its alliance with USAball and formed 
GCCball, an alliance with other Gulf monarchies, and the stage was set for conflict.
Proxy wars
Iran-Iraq War
The rise of Iran as a regional power threatened other neighboring countries as well. In September 1980, Iraqball, in its Ba'athist form, invaded Iran in hopes of stopping the Iranian revolution, gaining power, and annexing some of its oil reserves. However, it didn't get far, and the war bogged down into a stalemate, with trench warfare, chemical weapons, and heavy civilian casualties.
When Iran finally started winning, Saudi Arabia panicked and came to Iraq's rescue. It provided money, weapons, and logistical help. It become critical that Saudi Arabia must build up Iraq into a buffer zone to hold off Iran's torrent. Saudi Arabia helped Iraq fight until 1989, by then nearly a million people had died. Iran largely blamed Saudi Arabia for the war, and their feud escalated.
2003 invasion of Iraq
Fast forward 15 years since the war, and you'd see how Iraq again became a scene of proxy war. In 2003, USA led an invasion of Iraq, and overthrew Saddam Hussein, killing off Iraq's Ba'athist form. Neither Saudi Arabia nor Iran wanted any of this to happen, as Iraq's clay acted as a buffer between them.
Problems arose when USA was strugguling to replace Saddam. It really had no idea what it was getting itself into after invading. Making one mistake after another, creating a security vacuum, making it into a failed state, and giving it an all-out civil war. Without Iraq in control, armed militias began to rise and take power in its clay, splintering the population.
Sunni and Shia militias suddenly sprang up all over the country, many being radical islamist groups who saw the opportunity to gain power in the chaos. These militias were readymade proxies for Saudi Arabia and Iran, and they both seized the oppotunity to try and gain influence. Saudi Arabia began to fund and militarize Sunni militias, and Iran having done the same to the Shia. Iraq was suddenly a proxy war with both powers supporting opposing sides.
The Arab Spring
The invasion of Iraq and overthrow of its Ba'athist dictatorship government had sparked a series of anti monarchy, pro-democratic protests in 2011 called the Arab Spring. This had very different conciquences for Saudi Arabia and Iran. Each country threw their weight behind different groups all over the Middle East and North Africa. Like in Iraq, Saudi Arabia supported Sunni groups and governments, while Iran supported Shia groups to rise against them.
In 
Tunisiaball, Saudi Arabia backed a dictator, while Iran backed the protestors. In Bahrainball, Iran supported the Shia leaders seeking to overthrow the government. Saudi Arabia, in turn, sent troops to help unquash the unrest. Both got involved in 
Libyaball, 
Lebanonball, 
Moroccoball, and various other Arab states. As they were putting pressure on these countries, they began to fall.
Yemeni Civil War
In Yemen, Saudi Arabia sent its military to help fight against 
Houthis, an Iranian Proxy group.
Syrian Civil War
The reverse in happening in Syria. Iran's military is fighting side by side with militias, 
Hezbollah, and Syriaball in support of dictator Bashar Al-Assad, in order to fight against rebel Saudi proxies groups.
War on Terror
Meanwhile in Syria and Iraq's clay, 
ISISball is losing, and both Saudi Arabia and Iran are angling to take control of their territory.
Conclusion
The more civil wars and insurgencies break out, the more Saudi Arabia and Iran will become involved. Now the cold war is drawing in other countries. Saudi Arabia even began threatening its neighbor 
Qatarball for building ties with Iran. It's a cold war which is becoming incredibly unpredicatble. As the Middle East continues to destablize, it's hard to say how far these countries will go.
