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The United States hopes that Saudi Arabia may restore diplomatic ties with Iran, a senior State Department official said by phone on Friday ahead of Secretary of State John Kerry's Saturday visit to Riyadh. 

Tensions between bitter regional rivals Saudi Arabia and Iran escalated this month after Riyadh's execution of a Shi'ite Muslim cleric triggered an attack by Iranian protesters on its Tehran embassy, leading the kingdom to cut diplomatic ties. 

However, the U.S. official said Iranian Supreme Leader Ayatollah Ali Khamenei's statement of regret this week over the embassy storming, which Riyadh accused Tehran of tacitly encouraging, was "significant". Iran denies the allegation. 

"Hopefully, maybe that will open up the possibility that the situation will resolve and that the Saudis will find their way forward in reopening their embassy in Tehran," he said.