by Patrick Kamenka
NAJAF, Iraq, Aug 11 (AFP) - US forces readied Wednesday for a final assault to defeat a Shiite uprising, which Iraqi officials have blamed for halving vital oil exports, after British forces struck militia bastions in the south.
As foreign troops intensified their attacks on his Mehdi Army, militia leader and radical Shiite Muslim cleric Moqtada Sadr urged his followers to fight on even if he was killed.
Reinforced US troops and Iraqi national guardsmen have been training for "major assaults" against Sadr`s fighters, hunkered down in the holy city of Najaf of central Iraq during seven days of fighting, the US military said.
"Iraqi and US forces are making final preparations as we get ready to finish this fight that the Moqtada militia started," said marine commander Colonel Anthony Haslam.
But Sadr pressed his supporters to fight to the end, in a statement handed out in Najaf.
"If I die a martyr or if I am taken prisoner, I urge the Mehdi Army to continue to fight the occupation forces," he said.
News of the imminent US offensive, which followed Britain`s largest operation against militiamen in the city of Amara, appeared to expose fraying relations between the military and Najaf governor Adnan al-Zorfi.
Zorfi denied troops were preparing for a final attack and vowed that US soldiers would not approach Najaf`s Imam Ali mausoleum, one of Shiite Islam`s holiest shrines, after the military said he had given them permission to do so.
Twenty people were killed and 50 wounded when British forces, backed by air power, pounded strongholds of Sadr`s militia in Amara, medics said.
At British headquarters in Iraq`s main southern city of Basra, a spokesman said multinational forces had used "appropriate force in a very targeted and precise manner" against militiamen who persisted in attacking coalition bases.
Further north in Kut, which fell briefly to Sadr supporters during the cleric`s previous uprising in the spring, two Iraqi national guardsmen and three police were wounded in morning clashes, a doctor said.
Spokesman Majid Hameed said a written death threat had been delivered to the province`s governor for refusing to bow to demands from Sadr supporters that Kut secede from Iraq with other Shiite provinces of the south and centre.
In the capital, the National Security Council said the closure of a southern oil pipeline, following a militia threat of attack on Monday, had halved Iraqi crude exports and led to daily losses of 30 million dollars.
"If the entire pipeline is blocked, Iraq will suffer from a daily 60 million dollar financial loss," it said.
The disruption to supplies on Tuesday helped push New York crude prices briefly to a record of more than 45 dollars a barrel. Although they later fell back, prices continued their march upwards in trading on Wednesday.
South of Baghdad, a top official of a mainstream Iraqi Shiite religious party was assassinated by unknown gunmen, a Tehran-based spokesman for the faction said.
Ali Saadi was the former head of the military wing of the Supreme Council of the Islamic Revolution in Iraq.
In Nasiriyah, 6,000 people protested against the fighting between militiamen and foreign troops that have killed 14 in the Shiite city of southern Iraq over the past week.
At least 195 people have been killed and almost 1,000 wounded in Sadr`s fresh uprising, according to an AFP toll based on government, hospital, Mehdi Army and US military figures.
Meanwhile, Iraq`s foreign hostage crisis shot back to prominence with the snatching of two Jordanians in 24 hours, as Sofia confirmed a body found in Iraq had been identified as that of a second Bulgarian hostage kidnapped last month.
He was killed by a group linked to the Al-Qaeda network, along with the other hostage.
But three journalists of Iran`s state news agency IRNA who were initially reported kidnapped -- just days after an Iranian diplomat was snatched in Iraq -- turned out to have been arrested by Iraqi police.
At least six Iraqis were killed and 10 wounded as a blast ripped through a popular marketplace in Khan Beni Saad, northeast of Baghdad, the Baquba general hospital said.
And two people were killed and four wounded in what appeared to be a US airstrike on the Sunni Muslim insurgent bastion of Fallujah, police said.
Back in Najaf, the office of Iraq`s most revered Shiite cleric, Grand Ayatollah Ali al-Sistani, said he would not after all require heart surgery in London, where he is being examined by doctors.
Amid the standoff against militiamen, the interim government looked set for a new showdown with disgraced former Pentagon favourite Ahmed Chalabi who returned to Iraq from neighbouring Iran to face money counterfeiting charges.