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Iraq Premier Says War May Spread in Region as U.S. Weighs Action

June 18 (Bloomberg) -- Iraqi Prime Minister Nouri al-Maliki said the extremist threat his forces are battling north of Baghdad will spread to neighboring countries as the U.S. weighed options on how to counter the attack.

“They will flee to you and your countries will also be inflamed with sectarian wars,” Maliki said in a televised speech today after firing four of the northern command’s top officials following last week’s loss of Mosul, the country’s biggest northern city. “What happened was a disaster, but not every setback is a defeat.”

President Barack Obama is considering whether to use U.S. military power to help Maliki’s Shiite-led government beat the Sunni Islamic State in Iraq and the Levant, whose battlefield success has raised the risk of a sectarian civil war. Oil prices rose amid fierce fighting over control of a major refinery at Baiji north of Baghdad.

Obama, who this week sent a small contingent of troops to defend U.S. diplomatic posts in Iraq, is scheduled to brief congressional leaders today on America’s options. He has emphasized he favors political steps before any military moves to contain Iraq’s turmoil. U.S. National Security Council spokeswoman Bernadette Meehan said last night that Obama hadn’t yet made a decision about military options.

Baiji Refinery

Clashes between ISIL fighters and the armed forces have broken out across northern and central Iraq since the fall of Mosul, with both sides claiming successes that can’t be independently verified.

Police in Salahuddin province today said ISIL gunmen had seized the facility, while military spokesman Qassim Ata said later that government forces had regained control. Output was halted June 15 at the refinery, which has a capacity of more than 300,000 barrels a day. Brent crude trade above $113 for a fifth day on the fighting.

U.S. Treasury Secretary Jacob J. Lew said on a trip to Israel that the U.S. has increased “unmanned, unarmed” drone missions in Iraq to support counter-terrorism efforts as the crisis intensifies.

In Shiite Iran, President Hassan Rouhani said the “Iranian people” would spare no effort to protect Shiite holy sites in the Iraqi cities of Karbala, Najaf and Samarra, state-run Mehr news agency reported.

Religious Shrines

“People are ready to defend the Imam’s shrines and give a lesson to terrorists,” Rouhani was quoted as saying.

Maliki has been criticized for sidelining the country’s Sunni minority, and Obama has said any U.S. military action depends on moves toward a more inclusive government. While Maliki didn’t name the states supporting militants in Iraq, his government yesterday accused Saudi Arabia, the region’s biggest Sunni power, of being responsible for the “moral and material support” for the gunmen.

Kurdish peshmerga armed forces clashed with ISIL insurgents elsewhere in the same province, killing 10 fighters and wounding 30, their spokesman, Jabar Yawar, said by phone. He said two peshmerga were killed and 20 wounded.

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