Iran warned on Thursday that its Gulf Arab rivals were jeopardising Lebanon's stability by blacklisting the leading force behind its government, Hezbollah, as a terror group.

Deputy Foreign Minister Hossein Amir Abdollahian said that the Shia militant group, which is one of Iran's closest allies, was a bulwark against terrorism in the region.

"We are proud of Lebanon's Hezbollah as the vanguard of resistance against the Zionist regime and the champion of the fight against terrorism in the region," Abdollahian told Iran's official Irna news agency.

"Those who call Hezbollah terrorists, have intentionally or unintentionally harmed the unity and security of Lebanon."

Wednesday's move against Hezbollah by the six-member Gulf Cooperation Council (GCC) was the latest salvo in an intensifying battle for regional influence between Saudi Arabia and Iran.

Riyadh has been alarmed by the international rehabilitation of Tehran since it reached a deal with major powers last year ending a 13-year standoff over its controversial nuclear programme.

Saudi Arabia has also been angered by the military intervention of Hezbollah in neighbouring Syria since 2013 in support of Iran-backed President Bashar al-Assad against Sunni rebels it has invested heavily in backing.

Hezbollah fighters have been active against the Islamic State group and Al-Qaeda but they have also battled non-jihadist rebel groups supported by the Gulf states and the West.

The intensifying battle for influence between the region's powers has sparked growing concern in Lebanon, which relies heavily on the Gulf states for tourism, investment and as a market for its exports.

In January, Riyadh led several Arab countries in cutting diplomatic ties with Tehran after demonstrators burned its embassy and a consulate in protest at its execution of a prominent Shia cleric.