by Patrick Kamenka
NAJAF, Iraq, Aug 16 (AFP) - Clashes broke out in Najaf as delegates from a national conference prepared to travel to the holy city in a bid to coax rebel leader Moqtada Sadr back from the brink before a threatened US-led assault.
The fresh fighting came as the military announced three US marines were killed "as a result of enemy action" in the province on Sunday.
Hundreds of demonstrators and tribal chiefs from across Iraq converged on the Imam Ali mausoleum, one of Shiite Islam`s holiest sites, to protest at continued fighting between the militia and US-led Iraqi police.
Dancing and singing, they brandished pictures of Sadr and denounced Iraq`s interim Prime Minister Iyad Allawi and the US "occupying forces".
Above the festivities, heavy weapons fire and machine guns rattled, as US aircraft circled overhead on the second day of intermittent clashes after talks broke down between Sadr and the Iraqi government.
"A major assault by forces will be launched quickly to bring the Najaf fight to an end," interior ministry spokesman Sabah Kadhim said late Sunday.
The government has insisted that the militia disarm and quit Najaf for there to be any peaceful solution to the crisis.
Amid looming fears of a fresh offensive, police ordered all journalists out of Najaf on Sunday, as one person was killed and two wounded when US troops fired on pro-Sadr demonstrators near the cemetery, a surgeon said.
Bullets also hit the northern wall of the Imam Ali shrine, witnesses said.
In Baghdad, at least 50 delegates from the national conference prepared to drive to Najaf, confident they could persuade Sadr to vacate the shrine.
"We are hopeful and optimistic that we would be able to convince Sayed (honorific) Moqtada and his followers to leave the shrine," said Fadel al-Khorsan, an aide to cleric Sheikh Hussein al-Sadr, a relative of Moqtada.
"We are even ready to escort them to a safe place elsewhere in city and guarantee that no one will harm them in any way," he added as the second day of Iraq`s national conference wound down.
"We must work together to convince Moqtada Sadr and the dear brothers in the Mehdi Army to transform (their militia) into a political party whatever its leaning," Sheikh Hussein al-Sadr told the conference.
The reaction in Najaf was muted.
"We can come to an agreement on this through negotiations. We are ready to defend ourselves as we are ready for peace," said Sadr spokesman, Sheikh Ahmed Shaibani, in response to the initiative.
Elsewhere, a teenage girl and her six-year-old brother were killed and four other relatives wounded when one of three mortar bombs aimed at a US base in the restive city of Baquba hit their home, their father and the police said.
One Iraqi was killed and 17 others wounded when US tanks shelled southern neighbourhoods of Fallujah, a notorious Sunni insurgent bastion, a doctor said.
In the southern city of Amara, one civilian was killed and two others wounded in afternoon clashes between Mehdi Army fighters and British troops, a doctor said.
In London, oil prices climbed to a new record high of 44.11 dollars a barrel as traders took fright at persistent insecurity around the oil fields of southern Iraq.
Further north in Nasiriyah, deputy governor Adnan al-Sharifi said a US journalist, Micah Garen, had been kidnapped while reporting on archaeological sites in the area.
Garen is the founder and head of Four Corners Media, a company specialising in film, photo and written documentaries with offices in New York and Colorado, according to its website.
The head of archaeological services in Nasiriyah, Abdul Amir al-Hamdani, said Garen had been kicked off an Italian base after accusing troops of killing civilians, including a pregnant woman, in clashes with Shiite militia.
Meanwhile, Iran warned Baghdad that it was taking "very seriously" the matter of an Iranian diplomat held hostage in Iraq and threatened with "punishment" by his captors.
A group calling itself The Islamic Army of Iraq has said it will "punish" Jahani if Iran does not release 500 Iraqis allegedly held since the Iran-Iraq war of 1980-88. Iran maintains that it has freed all its prisoners of war.