The only thing that happens between those two countries is sabre-rattling. I doubt that many people would even know about it in the outside world, were it not for Call of Duty: Black Ops 3 making it part of its story-line.

The past three or four notable Presidents (Sadat, Mubarak, Morsi, el-Sisi) have all had 'war plans' for Ethiopia. One involved airstrikes, another involved paratroopers. A few months ago, Ethiopia's Prime Minister Ahmed also made a comment that Egypt perceived as aggressive.

Ethiopia will indeed need more water as its population expands. Ethiopia is also a large cotton exporter, with cotton being a water-intensive crop. Thus it is not unfeasible that Ethiopia simply decides to retain more water in order to prevent the instability that comes with scarcity. It will obviously prefer internal stability over international relations. Ahmed has made large strides towards breaking up the sort of 'Apartheid'-like system which gave strong powers to Ethiopia's many regions, and is creating a more centralized state in its place. Combine this with his political liberalization efforts and it is no surprise that an attempted coup was already launched last year in Amhara. I suspect that Egypt would easily defeat Ethiopia in a one-on-one fight. Even Israel fears Egypt, whose military is both vast and well-equipped, armed with many American weapons. Were it not for Sadat betraying Assad, it is likely that Israel would have been ended back in 1973. Furthermore, Ethiopia has many separatist groups who can be aided by its enemies. Eritrea also has very poor relations with Ethiopia, and yet as Ethiopia is landlocked, it is reliant on Eritrea for access to the oceans.

But neighbouring countries complicate matters. Ethiopia will almost certainly resort to pan-Africanism while Egypt will almost certainly resort to both pan-Arabism and Islamism. Relations between the Arab League and the African Union, for example, would strike a record low. Some countries, like Sudan, could go either way (they identify as Muslim Arabs but are overwhelmingly racially African).

Djibouti is also something of a factor because of the sheer level of foreign influence there. I believe the French, Japanese, Saudis, Americans and Chinese all have bases there... and not all of these nations will align the same way. Either way, war would probably result in a rapid regime change in Ethiopia, complete with population decline and mass migration southwards into Somalia and Kenya.