Days after U.S. Ambassador to Yemen Gerald Feierstein challenged Iran on its alleged interferences in Yemen, accusing Tehran of sponsoring political instability in Yemen through its alliances and financial support of groups and militias across, Iran was quick to retaliate with both Iranian Ambassador to Sana'a Mahmoud Hassanzadeh and Iran Foreign Ministry' spokesman, Ramin Mehman-Parast calling the accusations "baseless and fallacious."

Teheran is now arguing Washington is trying to propagate Iranophobia in the region. Ahmed Sohani an Iranian MP - Member of Parliament said Tuesday "Over the past few years, the U.S. has tried to create Iranophobia among regional countries by leveling accusations at Iran."

"The US and the West are trying to influence regional public opinion by creating a negative anti-Iranian climate through using the media under their control and justify their meddlesome presence in the region by exploiting this hazy atmosphere," he added.

This new war of words was prompted by declarations made by Yemen Southern Movement - al-Harak - earlier this month it would not participate in the National Dialogue and would continue to seek independence from the central government.

Qasim Askar Gibran, the Secretary General of the Supreme Council of the Southern Movement in Aden tolf al-Jazeera on January 2, 2013 "This initiative [National Dialogue] is not related to us and it does not resolve the problem of Southern Yemen; rather it is just a solution to resolve the crisis between the government and the Northern Yemen's opposition forces."

"The Southern Movement proposes drafting of a new initiative plan based on the principle of negotiations between the Northern and Southern governments of Yemen and returning of sovereignty to the government of the South," he added.