by Jay Deshmukh
NAJAF, Iraq, Aug 22 (AFP) - Heavy clashes erupted between US troops and Shiite militiamen in the Iraqi holy city of Najaf Sunday after the proposed handover of the militia`s shrine stronghold to the Shiite religious leadership was suspended.
Despite the rumbling crisis, which has helped world oil prices to historic highs, crude exports from southern Iraq returned to their normal level overnight, the state-owned firm which operates the fields said.
Fighters loyal to Shiite radical leader Moqtada Sadr launched multiple attacks on US tanks, parked around 300 metres (yards) away from the Imam Ali shrine, as the reverberations of gunfire and mortar bombs could be heard from inside the mosque compound, an AFP correspondent on the scene said.
Overnight, US warplanes pounded the city, causing three large explosions near the mausoleum, as the US army confirmed military operations were continuing at the request of the Iraqi government.
American troops backing Iraqi forces in Najaf had scaled back their deployment Saturday, but an AFP correspondent said Sunday`s clashes were more intense than the sporadic firing the previous day.
Some two days after spokesmen for both Sadr and Grand Ayatollah Ali al-Sistani announced the deal to hand over the keys to the shrine, which the Mehdi Army have occupied since their April uprising, talks bogged down.
"We do not know how long it will take. It all depends on the situation and Sistani," Sadr`s junior spokesman Sheikh Ahmed al-Shaibani told AFP in Najaf.
"The matter is suspended as of now, because we are awaiting the response from Sistani about forming the committee" tasked with carrying out a full inventory of the shrine`s priceless works of art and alms.
Sistani has been reluctant to take back the shrine without ensuring that nothing is missing and the Mehdi Army is unwilling to surrender control amid any suggestion of impropriety.
In the southern cities of Basra and Amara, clashes also flared between British-led forces and the Mehdi Army overnight, with patrols and coalition bases coming under small arms and mortar fire, a spokeswoman said.
The two-week crisis in Najaf has provided the biggest challenge to Prime Minister Iyad Allawi since his caretaker government received full powers with the formal winding up of the US-led occupation on June 28.
While containing the Shiite uprising would bolster his fledgling government, a prolonged standoff with Sadr risks further undermining his authority, already sapped by a persistent insurgency in Sunni areas north and west of the capital.
In Al-Khalis, northeast of Baghdad, two people were killed and at least eight wounded when a suicide bomber blew up a parked car as the deputy provincial governor`s convoy drove past, police and medics said.
Pieces of flesh were found littered on the ground after the attack.
Faced with the relentless violence, Polish Defence Minister Jerzy Szmajdzinski said his government wanted to pull its troops out of Iraq as soon as possible, the PAP news agency reported.
"We want to get out of Iraq as soon as possible, but first we have to build solid security conditions," he said during a visit to Poland`s 2,500-strong contingent, which has lost 14 soldiers since last year`s US-led invasion.
But the South Oil Company offered a life-line to world oil markets by announcing that southern oil exports had returned to their normal level of 85,000 barrels an hour as of late Saturday.
For 13 days, daily exports were down to between 36,000 and 42,000 barrels due to Mehdi Army threats to blow up oil pipelines feeding the two Gulf terminals.
Meanwhile, fears grew for the safety of one Italian and two French reporters, the latest of dozens of foreigners to have gone missing in Iraq since April.
The correspondents of Radio France Internationale (RFI) and the Paris daily Le Figaro were last heard from on Thursday.
The two news organisations said they were "concerned" about correspondents Christian Chesnot and Georges Malbrunot, who had not reported in since Thursday.
The newspaper of Italian journalist Enzo Baldoni, who has also been missing for three days, announced Saturday that he may have been kidnapped.
There was nonetheless renewed hope for kidnapped US journalist Micah Garen after Sadr`s office in Baghdad -- which has been spearheading efforts to secure his release -- said late Saturday that he should be freed within two days.