BAGHDAD, Aug 15 (AFP) - The Iraqi government reluctantly gave the green light for resumption of a US-led offensive on Shiite Muslim militiamen in the holy city of Najaf after peace talks broke down Saturday, but said a long-awaited national conference would be held on schedule Sunday in Baghdad.
And sabotage-crippled northern Iraqi oil exports to Turkey resumed, although a crucial southern pipeline remained shut for security reasons.
"I am overcome with deep grief as I declare that the efforts being made to reach a peaceful solution to the crisis in Najaf have failed," national security advisor Muqafaq al-Rubaie told a news conference.
"My government thinks it is time for me to break off the negotiations and return to Baghdad," he said. "Yes, the military operations will start."
Thousands of Sadr supporters poured into the besieged pilgrimage city in central Iraq, where fighting had paused for the two-day truce, to protest the US-led assault, denounce Prime Minister Iyad Allawi and embrace Sadr's Mehdi Army fighters.
Sadr aides blamed the caretaker premier for the breakdown of truce talks.
"The Iraqi government will be responsible for the coming massacre in Najaf," said Sadr spokesman Sheikh Qais al-Khazali. "Tanks and convoys are preparing to attack the city in the coming hours."
The government announced that Iraq's much anticipated national conference, seen as a first experiment in post-Saddam Hussein democracy, would go ahead Sunday despite the resumption of fighting in Najaf.
"There was concern during the past few days that the conference would be delayed, but it will start tomorrow at 11:00 am (0700 GMT)," said chief conference organiser Fuad Maasum.
Interior Minister Falah al-Naqib said a curfew would be imposed on central Baghdad during the conference, to be attended by some 1,300 delegates.
Maasum again invited Sadr's movement to participate in the conference, but Sadr spokesman Sheikh Ahmed Shaibani called the conference "a joke," as thousands of the cleric's supporters streamed into Najaf in a show of solidarity.
"We won't participate in a conference under the supervision of occupation forces. It is a joke," said Shaibani.
In the flashpoint city of Fallujah, meanwhile, eight Iraqis were killed and 10 others wounded, mostly women and children, after US troops clashed with insurgents on Saturday, according to hospital sources there.
"We have received eight killed and 10 injured," said doctor Ali Khamis at Fallujah's general hospital.
The US military said earlier it had struck suspected insurgent strongholds in Fallujah after the rebels attacked a Marine post on the outskirts of the city with rocket propelled grenades and machine gun and small arms fire.
As a counterpoint to the prospect of resumed fighting in Najaf, northern Iraqi crude exports resumed to Turkey. Exports have already been strangled by the shutdown of a key southern pipeline over security concerns.
Pumping resumed to the port of Ceyhan at levels not seen for the past year due to repeated sabotage, an official from the state-owned Northern Oil Company said.
"Pumping resumed this morning at 8:00 am (0400 GMT) from the oilfields in Kirkuk to Ceyhan at the rate of 600,000 to 800,000 barrels per day," an official told AFP.
Crude exports from the south's two main offshore terminals have been slashed in half for several days, costing the country millions of dollars in lost revenue and helping to send world oil prices to record levels.
Meanwhile, US forces continued their assault on Sunni Muslim insurgents, as warplanes bombed "known enemy locations" around Samarra, north of Baghdad, in an overnight air and land assault that the military said killed 50.
There was no independent confirmation of the death toll given by US commanders. Samarra's main hospital reported 25 dead and 86 wounded from the fighting, many of them women and children.
More than 40 homes, the municipal building and the political party offices of Interior Minister Falah al-Naqib were destroyed in the city.
South of Baghdad, 14 people were killed and 37 wounded in fierce gun battles in Hilla between the Mehdi Army and Polish-backed Iraqi police, the health ministry said.
Fighters attacked police stations and government buildings. Police chief General Qais Hamza Aboud said 49 militiamen and three policemen were killed.
Seventy Poles, trapped inside a police station during the fighting, returned to their base Saturday, the Polish military said.
In the troubled western province of Al-Anbar, two US soldiers were killed, bringing to 694 the number of US troops who have died in action since the US-led invasion of Iraq in March 2003, based on Pentagon statistics.
Three Iraqis were also killed in clashes between US troops and insurgents in the restive Sunni city of Ramadi, west of Baghdad, medics said.
And in the north, police reported a Syrian truckdriver was kidnapped and said one civilian was killed when US forces opened fire after their convoy was attacked.