The situation in Iraq remains volatile as fighting continues in the holy city of Najaf. Shiite militia fighters loyal to radical cleric Muqtada al-Sadr have been holed up in the Imam Ali mosque for three weeks now, putting up fierce resistance against U.S. troops and Iraqi security forces.
The insurgency has sparked violence in other Shiite communities in central and southern Iraq, including the Baghdad slum of Sadr City. The southern city of Samawah, where Japanese troops are stationed, is no longer safe, as al-Sadr's Mahdi Army fighters have stepped up guerrilla activities. In the southern oil city of Basra, they have reportedly attacked pipelines and other facilities.
The future of all of Iraq, not just central and southern regions, now depends on how the Najaf situation develops. The question also has serious implications for the global economy, particularly for world oil prices. It appears that the moment of decision is approaching not only for the interim government of Prime Minister Iyad Allawi but also for the U.S. administration of President George W. Bush.