Three Sunni-led countries — Bahrain, Sudan and the United Arab Emirates — joined Saudi Arabia yesterday in severing or downgrading diplomatic ties with Iran, as the dispute between the region’s top Sunni and Shia powers rippled across the region, driving up oil prices and threatening to widen the Middle East’s sectarian divide.

For its part, Shia-led Iran accused Saudi Arabia of using an attack on the Saudi embassy in Tehran two days earlier as a pretext for diverting attention from its problems.

Iranian protesters ransacked and set fire to the embassy on Saturday, along with the Saudi consulate in Iran’s second-largest city, Mashhad, after the Saudis executed a Shia cleric who had criticised the Sunni kingdom’s treatment of its Shia minority. The Shia cleric Nimr Nimr was hailed as a “martyr” by Iran, whose Supreme Leader warned Saudi Arabia’s ruling Al Saud family on Sunday of “divine revenge”.

… Mr James Dorsey, who does research on the Middle East and North Africa at the S. Rajaratnam School of International Studies in Singapore, told TODAY that the situation would likely fuel sectarian strife outside the Middle East, including Pakistan, which has a significant Shia minority.