Prime Minister Nuri al-Maliki has offered an amnesty aimed at undercutting support for the militants who have overrun large areas of Iraq, after the new parliament's first session ended in farce, with MPs walking out instead of working on government formation.
With calls for politicians to come together unsuccessful, Washington contacted Iraqi and regional players individually, with President Barack Obama calling Saudi Arabia's King Abdullah and Vice President Joe Biden talking to former Iraqi parliament speaker Osama al-Nujaifi, a prominent Sunni leader.
The White House said Biden and Nujaifi agreed on the importance of Iraqis "moving expeditiously to form a new government capable of uniting the country".
Secretary of State John Kerry meanwhile phoned Kurdish leader Massud Barzani and stressed the important role the Kurds could play in a new unity government in Baghdad, seen as vital to meeting the challenge of Islamic State jihadists, who have led the militant offensive, spokeswoman Jen Psaki said.
Maliki's amnesty call appeared to be a bid to split the broad alliance of jihadists, loyalists of executed dictator Saddam Hussein and anti-government tribes waging the offensive.
Maliki's announcement came a day after an eagerly awaited opening to the Council of Representatives descended into chaos and ended in disarray without a speaker being elected.
Under a de facto agreement, Iraq's premier is a Shiite Arab, the speaker Sunni Arab and the president a Kurd.
Presiding MP Mahdi Hafez said the legislature would reconvene on July 8 if leaders were able to agree on senior posts.
In another sign of political discord, Maliki yesterday rejected an assertion by the autonomous Kurdish region that its control of disputed territory is here to stay.
On the ground, Iraqi forces were struggling to break a stalemate with militants after initially wilting before the onslaught. They have since performed better, albeit with limited offensive success.
A police lieutenant colonel said security forces today clashed with militants near Tikrit, the hometown of Saddam Hussein, which they have been unsuccessfully fighting to retake in a highly-touted operation for over a week.
The cost of the conflict has been high for Iraq's forces, with nearly 900 security personnel among 2,400 people killed in June, the highest figure in years, according to the UN.
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