Iraqi Arab lawmakers from rival sects joined forces Sunday to criticize what they claim is overreaching by the Kurds, alleging the powerful U.S.-backed minority's go-it-alone style in oil and other major issues threatens national unity.The 145 Shiite, Sunni and other legislators signaled their opposition to Kurdish ambitions in the disputed northern city of Kirkuk and in negotiating deals with foreign oil companies without involving the central government.

"There must be a formula for maintaining the unity of Iraq and the distribution of its wealth," said secular lawmaker Osama al-Nijifi, reading from a declaration at a news conference in the capital. "Oil and gas are a national wealth, and we are concerned about those who want to go it alone when it comes to signing deals," he said.

The declaration, which was careful not to mention the Kurdish government by name, could create new tensions among Sunni Arab, Shiite and Kurdish groups.

The Kurds are a key group within the governing coalition and have been Washington's most reliable allies in Iraq. Since the ouster of Saddam Hussein they have forged a close relationship with the majority Shiites.

But recent assertive acts by the Kurds, such as the refusal to fly the Iraqi national flag in the region, have irritated the Shiite-dominated government in Baghdad as well as Sunni Arabs.

Many see such gestures and the recent oil deals as a threat to the country's national unity. Complicating the situation is a major Shiite party's aggressive calls for a self-ruled region in southern Iraq modeled after the Kurdish one.

Kurdish regional officials declined to comment, saying they have not yet seen the declaration. But Mohamoud Othman, a prominent Kurdish lawmaker close to the leaders of the Kurdish region, called the statement "somehow negative and impulsive."

"The demands of the Kurdistan government regarding oil and Kirkuk do not contradict the Iraqi constitution," he told The Associated Press. "Such statements complicate problems instead of solving them."

At least one divisive issue may soon be resolved. Kurdistan's president, Massoud Barzani, said Sunday that he would fly the Iraqi flag once the parliament in Baghdad changes the Saddam-era design.

Nevertheless, Sunday's declaration from Shiites and Sunnis comes as Kurdish politicians are taking increasingly tough stands on the dispute over the fate of Kirkuk. Arab and Turkomen residents oppose the Kurdish claim to the city, 180 miles north of Baghdad.

Saleh al-Mutlaq, leader of parliament's second largest Sunni Arab bloc, told the news conference the declaration did not mean the creation of an ethnic Arab alliance opposed to Iraq's Kurdish minority. "We are working for the unity of the country and that takes precedence over anything else," he said.

The Kirkuk dispute was supposed to be resolved by the end of 2007 with a referendum among its inhabitants on whether it should remain ruled by Baghdad or be annexed to Kurdistan. The vote is now expected before the end of June.

The other major point of contention is oil.

With a proposed national oil and gas law bogged down in dispute between the Kurds and the government over who has the final say in managing oil and gas fields, the Kurds have signed 15 production-sharing contracts with 20 international oil companies, most of them obscure.

The Iraqi oil minister, Shiite Hussain al-Shahristani, considers these contracts illegal, and has threatened to exclude and blacklist foreign oil companies who sign them from future opportunities in other parts of Iraq.

The ministry also has said it would stop all crude exports to South Korea if that nation proceeds with a deal between a state-owned consortium and the Kurdish government.

A spokesman for the Kurdish region, Jamal Abdullah, insisted the contracts are legal.

"We are going forward to develop this sector to serve our people, and anyone who has any complaint should file it to the federal court," he told the AP on Sunday.

Abdullah also said Kurdish officials are negotiating with two Canadian firms on a joint venture to construct an oil refinery and continue work on a second one.

Iraq, the holder of the world's third-largest crude oil reserves with an estimated 115 billion barrels, aims to boost production to 3 million barrels per day by the end of 2008. The oil law under consideration at Parliament would divide the country's oil and gas revenue among Shiites, Sunnis and Kurds.

Although the oil bill is one of the benchmarks sought by the United States to achieve national reconciliation, the Kurds have managed to all but kill the legislation.

Separately, a roadside bombing north of Baghdad killed a U.S. soldier and wounded four, the military announced Sunday. The attack took place Saturday in Ninevah province.

And in the southern city of Basra, a senior official at al-Sadr's office was shot and killed by unidentified gunmen. Fayadh al-Moussawi was also believed to be a senior commander of al-Sadr's Mahdi Army militia.

http://news.yahoo.com/s/ap/20080113/...dfneTX4DwUewgF

this situation right here is most likely going to escalate more and more, not just the oil issue, but the whole Iraqi-Kurd issue, this is probably going to lead to the next round or phase of conflict......