UNITED NATIONS: Iran told the United Nations on Friday that it does not want to escalate tensions in the Middle East, even as it took a swipe at Saudi Arabia for what it called “sectarian hate-mongering".

Saudi Arabia was “spreading delusional hype about Iran” after failing to derail the nuclear deal reached with world powers, Tehran's Foreign Minister Mohammad Javad Zarif said in a letter to UN Secretary-General Ban Ki-moon.

“We have no desire or interest in escalation of tension in our neighbourhood,” Zarif said in the letter, obtained by AFP.

Saudi Arabia cut off diplomatic ties with Iran on Sunday after angry protesters ransacked and set fire to the Saudi Embassy in Tehran over the execution of Shia cleric Nimr al-Nimr.

The tensions between the Sunni and Shia powers have reverberated across the Middle East and the Muslim world, complicating efforts to resolve conflicts in Syria and Yemen.

“Iran has called for Islamic unity in the face of Saudi sectarian hate-mongering,” Zarif wrote.

The foreign minister called for unity to confront extremists and said Riyadh must make a “crucial choice” to either “continue supporting extremist terrorists” or “play a constructive role in promoting regional stability".

Iran and Saudi Arabia have repeatedly accused each other of backing extremist groups who are wreaking chaos in the Middle East.

Zarif accused Riyadh of waging a “senseless aerial campaign targeting the people of Yemen” and of thwarting efforts to reach a ceasefire and begin political negotiations to end the conflict there.

A Saudi-led coalition is backing Yemen's government in its war against Iran-backed Shia rebels who seized the capital Sanaa in September 2014.