The energy-rich Gulf Cooperation Council on Monday expressed support for Yemen's security days after Sanaa said it uncovered what it called an Iranian spy cell.
GCC secretary general Abdelatif Zayani praised Sanaa for dismantling the alleged spy ring and said the six-nation council "fully backs Yemen in all the measures it undertakes to reinforce stability and security," a statement said.
Yemen's defence ministry said last week that authorities dismantled an "Iranian spy network that had been operating in Yemen for seven years under the leadership of a former leader in the Iranian Revolutionary Guards."
Iranian foreign ministry spokesman Ramin Mehmanparast dismissed the accusation as "baseless."
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Relations between Sunni-majority Yemen and Shiite Iran have been strained as Sanaa accuses the Islamic republic of backing rebels from an offshoot of Shiite Islam in the north of the Arabian Peninsula state.
Tehran has repeatedly denied the claim.
Yemen's mountainous north is a stronghold of the Zaidi rebels, also known as Huthis, who from 2004 fought six wars with central government forces before signing a truce in February 2010. The rebellion claimed thousands of lives.
Dozens of people have also been killed in sectarian clashes since last year between the rebels and Sunni Salafists in the north.