The standoff has seen Saudi Arabia sever diplomatic ties with its longtime regional rival and could hinder efforts to resolve the conflicts in Syria and Yemen, where Riyadh and Tehran back opposite sides, as well as affect the implementation of the Iran nuclear deal.

Iraqi Foreign Minister Ibrahim al-Jaafari proposed mediation during a news conference in Tehran, but also referred to the execution of Sheikh Nimr al-Nimr as a 'crime.'

Saudi Arabia and its allies say al-Nimr was found guilty of terrorism charges, and that condemnations of the execution amount to meddling in Riyadh's internal affairs.

Iraq has undertaken a delicate balancing act amid the latest regional turmoil. The Shiite-led government in Baghdad relies on Iranian help to battle the extremist Islamic State group, but is also trying to repair ties to oil-rich Saudi Arabia, which last week sent an ambassador to Baghdad for the
first time in 25 years.

Speaking alongside Iranian Foreign Minister Mohammad Javad Zarif, al-Jaafari said Iraq's place in the heart of the Middle East allows it to play a role in trying to 'alleviate tensions.'

Russia also has offered itself as a potential mediator, though it's unclear whether Saudi or Iranian officials have responded to the proposal.

Read more: Pakistan expresses concerns over Saudi-Iran tension

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