"It is an act of sabotage, a serious terrorist act aimed at harming the interests of the nation and endangering the population", said the interior ministry.
Bahrain says an oil pipeline that exploded overnight was attacked by militants in the island nation.
Bahraini authorities have blamed an oil pipe blast that occurred in the country on Iran, calling it "an act of sabotage and a unsafe act of terrorism".
Bahrain has been combatting a low-level insurgency since the Sunni monarchy quashed a 2011 Arab Spring uprising led by majority Shiites.
"Terrorist acts witnessed by the country in the recent period are carried out through direct contacts and instructions from Iran", the ministry said in a longer statement on its website.
The explosion damaged cars and nearby buildings, forcing firefighters to evacuate those close to the flames in Buri, just outside of the capital, Manama.
Bahraini authorities have launched an investigation into the incident. He did not say what caused the explosion, nor did he name any suspects.
Bahrain relies on the Abu Safa field, which it shares with neighbouring Saudi Arabia, for much of its oil, pumped in via a 230 000-barrel-per-day pipeline.
This "is a risky Iranian escalation aimed at terrorizing citizens and damaging the world's oil industry", the minister tweeted.
"It seems the only thing that Bahraini officials have learned to do after any incident in the island is pinning the blame on Iran", Qassemi said in a statement on Sunday.
No group has claimed the attack.
It also suspended pumping oil to Bahrain after the attack on the crude oil pipeline.