Bulgarian Prime Minister Boyko Borissov, who arrived in Burgas soon after the blast, said the perpetrator was a male suicide bomber who boarded the bus, in spite of the fact that he was not part of the group.
Borissov said the perpetrator had shown airport authorities a US driving license, but that US authorities in the meantime said that the document was false.
He didn’t explain why passport control had failed to detect the false document.
The explosion took place around 17.30.
Panic followed, with conflicting reports over the number of dead and wounded. Reportedly it took 20 minutes for ambulances to arrive. The authorities sealed the airport and all flights were cancelled. Bulgarian TV stations broadcast scarce footage from the scene.
The blast comes on the 18th anniversary of a bomb attack on the headquarters of Argentina's main Jewish organisation by an Iranian-backed Hezbollah suicide bomber, which killed 85 people.
Iran suspected to have masterminded the attack
Israeli Prime Minister Benjamin Netanyahu blamed Iran and said his country would retaliate.
"All the signs lead to Iran. Only in the past few months we have seen Iranian attempts to attack Israelis in Thailand, India, Georgia, Kenya, Cyprus and other places," Netanyahu said in a statement.
"Eighteen years exactly after the blast at the Jewish community centre in Argentina, murderous Iranian terror continues to hit innocent people. This is an Iranian terror attack that is spreading throughout the entire world. Israel will react powerfully against Iranian terror," he said.
Israeli officials had previously said that Bulgaria, a popular holiday destination for Israeli tourists, was vulnerable to attack by Islamist militants who could infiltrate via Turkey.
Israeli security experts arrived in Bulgaria a few hours after the blast.
Bulgaria has excellent relations with Israel. During World War II, the country was the only one of Germany's allies that managed to save its entire 48,000-strong Jewish population from deportation to concentration camps and extermination. Despite pressure from Adolf Hitler, Bulgaria's parliament, the Orthodox Church, intellectuals and citizens opposed the deportations.
Anti-terrorism expert Ivan Boyadjiev was quoted on national TV as saying that this is the first such terrorist attack in Bulgaria. He blamed a private firm, responsible for the security of the Israeli tourists, for negligence.
Vladimir Chukov, an expert in Arab-related security matters, said that in early 2012, Sofia had received warnings from Israel about the eventuality of a terrorist attack on its tourists on Bulgarian soil, but that the warning was not taken seriously.
In January, the Israeli daily Haaretz wrote that Israeli authorities had requested several EU countries, including Bulgaria, to take measures to protect their tourists.
Borissov has downplayed the risk of radical terrorism in his country.
“Somebody wrote something and since yesterday, you are all asking me if there will be a terrorist act. This is harmful for tourism,” he said, going as far as to accuse the Israeli publication of carrying out paid badmouthing of his country.
Following the terrorist attack in the Russian airport of Domodedovo in January 2011, he said there could be no such attacks in Bulgaria.
“The Arab world makes business in Bulgaria. At every corner, there is a kebab shop. We hope people who take such decisions would take this in account,” he said.
High Representative Catherine Ashton said in a statement she was “appalled” and “deeply shocked” by the Burgas terrorist attack.
Ashton stopped short of accusing Iran.
“The terrorists who planned and carried out this attack must be brought to justice,” she stated.
The attack eclipsed the news of a scathing Commission report published yesterday, revealing Bulgaria’s failure to deal with organised crime.
Bulgaria aspires to become part of the EU border-free Schengen area. However, the Burgas blast could raise questions about the ability of the country to protect its borders.