The death toll from a powerful explosion at Iran's biggest port of Bandar Abbas has risen to at least 40, with more than 1,200 people injured, state media reported on Sunday, as firefighters worked to fully extinguish the fire, Reuters reported.

Saturday's blast took place in the Shahid Rajaee section of the port, Iran's biggest container hub, shattering windows for several kilometres around, tearing metal strips off shipping containers and badly damaging goods inside, state media said.

The incident occurred as Iran held a third round of nuclear talks with the United States in Oman.

Fires kept breaking out in different parts of the affected area as of Sunday night, according to state media, with helicopters and fire fighters continuing efforts to extinguish them, according to Reuters.

Chemicals at the port were suspected to have fuelled the explosion, but the exact cause was not clear and Iran's Defence Ministry denied international media reports that the blast may be linked to the mishandling of solid fuel used for missiles.