11.00pm - UPDATE
KUFA, Iraq - Two US soldiers and more than a dozen Iraqi militiamen were killed in skirmishes overnight around the Shi'ite holy city of Najaf, the fourth day of clashes since militia leader Moqtada al-Sadr offered a truce.
In Baghdad, US officials and Iraqi leaders put off further talks over the choice of a president to succeed Saddam Hussein when the US occupation authority is wound up a month from now.
With the top post of prime minister filled by Iyad Allawi on Friday and key ministerial jobs also broadly agreed on, talks deadlocked when Iraq's US-appointed Governing Council rallied behind one candidate for president in defiance of US pressure.
US officials wanted discussions to be put off to Tuesday, Council member Mahmoud Othman told Reuters: "The Americans have asked for the meeting to be delayed until tomorrow."
An aide to Allawi said negotiations would resume on Tuesday.
US officials and the UN envoy brought in to help form an interim government have pressed for Adnan Pachachi, the veteran scion of a pre-Saddam political dynasty, to take the largely ceremonial post of head of state. However, many of the 22 members of the Governing Council favour the Council's current president, Ghazi Yawar, a civil engineer long based in Saudi Arabia.
Violence poses the biggest threat to the US handover plan, which envisages Iraq's first free elections in the new year.
US military spokesmen said two soldiers were killed by Shi'ite militia at Kufa, just outside Najaf, late on Sunday and that US troops killed close to 20 guerrillas in response.
A bomb blew up in a van as a Dutch patrol approached it in Samawa on Monday but there were no casualties, Dutch troops at the scene said. Japanese forces are also in the area.
In the northern Kurdish city of Arbil, the offices of the Patriotic Union of Kurdistan political party came under mortar attack on Monday morning. Police said there were no casualties.
The British Foreign Office contradicted accounts of an ambush in Baghdad on Sunday where witnesses said Westerners had been abducted and others killed. It said in a statement that an Iraqi driver was killed but four Britons and another Iraqi got away by flagging down another car after their convoy was hit.
In Najaf, militant young cleric Moqtada al-Sadr declared a ceasefire on Thursday, after pressure from the Shi'ite religious and political establishment who are exasperated by two months of bloodshed between US forces and Sadr's Mehdi Army.
US commanders welcomed Sadr's offer to pull his forces off the streets but maintained their demands that he turn himself in on a murder charge and fully disband his militia.
The US army said one 1st Armoured Division soldier was killed in an ambush and another when a grenade struck his tank.
A spokesman said the truce did not seem to apply in Kufa, although at least one local Mehdi Army squad commander told Reuters it did and accused US forces of provoking his men.
"If his militia comes out after us, we are going to respond appropriately," the US official said.
Another soldier was killed in the region on Sunday, bringing the total US combat death toll in Iraq to 591.
US tanks advanced into Kufa toward the main mosque and skirmished with Sadr's Mehdi Army fighters based around it for about two hours around midnight (0800 NZT), residents said.
US commanders have said, however, they would be willing to wait several days to assess whether the ceasefire was holding.
Shi'ite leaders who had negotiated with Sadr said in Kufa on Sunday they were still optimistic. "There is a momentum for peace," said Shi'ite Governing Council member Ahmad Chalabi.
Almost all of the Iraqi Governing Council members meeting on Sunday favoured Yawar as president, Council members said. However, US administrator Paul Bremer and UN envoy Lakhdar Brahimi were pressing hard for Pachachi, sparking heated debate.
US spokesman Dan Senor denied, however, that the Council was under pressure: "We have not been leaning on anybody."
US and UN officials are mediating among Iraq's religious and ethnic groups. Prime minister-designate Allawi, a former exile with ties to the CIA, is from the long-oppressed Shi'ite majority. Council members Pachachi and Yawar are Sunni Arabs.
The Kurds had pushed hard for the presidency and would be compensated with two key ministries, defence and foreign affairs, Iraqi politicians involved in the talks said.
Bremer's US-run authority intends to hand over formal sovereignty to the interim government on June 30, although some 150,000 foreign troops, mostly American, will stay on in Iraq.
Pachachi, 81, was foreign minister in the 1960s, before Saddam came to power. His Baghdad-based family was a powerful force under the British-installed monarchy that fell in 1958. He has spent much of the time since in exile in Abu Dhabi.
Yawar, in his mid-40s, is a leader of a prominent Sunni tribe from the northern city of Mosul. A civil engineer, he left Iraq in 1990 and ran a telecoms firm in Saudi Arabia. He has criticised the draft UN resolution proposed by Washington and has said Iraq must have the right to ask US troops to leave.
- REUTERS
Herald Feature: Iraq
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