Early Monday morning, Iraqi government troops supported by the People's Mobilization Forces (PMF), a state-loyal umbrella organization composed of some 40 militias, have started advancing towards Peshmerga (military force of the autonomous region of Iraqi Kurdistan) frontlines from Taza, just south of the city of Kirkuk.
The Iraqi Joint Operations Command said that its forces had retaken the K1 military base northwest of Kirkuk, the military airport east of the city and the Baba Gargar oil field, one of six in the disputed region.
He did so by holding a referendum on Kurdish independence on 25 September that was greeted with enthusiasm by Iraqi Kurds. The referendum was bitterly opposed by Iran, Baghdad and Turkey and has since led to a blockade of the region by all three powers.
"This attack, waged by the Iraqi government, Hashd al-Shaabi and forces associated with the Headquarters of the Islamic Revolutionary Guards' Quds force, is in retaliation against the people of Kurdistan who have asked for freedom", the Peshmergastatement said, as reported by the Kurdish news outlet Rudaw.
The rapid progress of Iraqi forces suggested that Kurdish fighters were withdrawing with little or no resistance in many areas. Washington has called for "all parties to immediately cease military action and restore calm", adding that Isis remained the true enemy of all parties in Iraq and they should focus on its elimination.
Although Iraqi officials portrayed the Kurds as retreating without a fight, Kurdish officials said Peshmerga had clashed with the "Popular Mobilisation" - Shi'ite Muslim forces trained and armed by Iran that operate alongside regular Iraqi troops.
Kurdish leaders who met to discuss the crisis in the town of Dokan renewed their offer to "resolve peacefully" the crisis with Baghdad, Kurdistan Regional Government President Masoud Barzani's aide, Mr Hemin Hawrami, said. The U.S. has armed, trained and provided vital air support to both sides in their shared struggle and called the frictions a distraction against the most important fight.
Iraqi Kurdish dreams of achieving real independence depended on controlling the oil wealth of Kirkuk which is now lost to them, probably forever.
Kurdish claims are based off the 1957 Iraqi census, the last held in the province, which showed Kurds to be a majority in Kirkuk province, although the Turkmen and Arabs could claim a majority in Kirkuk city proper.
The conflict in Iraq helped spur a jump in world oil prices on Monday.
He said federal forces have been deployed in the area of the K-1 military base, the Kirkuk airport and a number of oil fields and installations.
The Kurdish secession bid was strongly opposed by neighbours Iran and Turkey.
Iraq's central government had earlier demanded the Kurds withdraw from military facilities and oil fields they had seized in recent years, mainly during the fightback against the Islamic State group.
The withdrawal of part of the Kurdish forces is ultimately a reflection of deep divisions between the Kurdish leaders and their parties, whose rivalry has always been intense.
There were signs of internal conflict among the Kurds, who have been divided for decades into two main factions, the KDP of regional government leader Barzani and the PUK of his longtime rival Jalal Talabani, who served as Iraq's ceremonial president in Baghdad from 2003-2014 and died two weeks ago. For years, Turkey has notably described a unilateral move by the Kurds to control Kirkuk as a red line.
The US-led task force said it was aware of "a limited exchange of fire during predawn hours", which it believed was "a misunderstanding and not deliberate as two elements attempted to link up under limited visibility conditions".
During the years of USA occupation that ensued, Washington leaned on its Kurdish allies to keep their ambitions in check to avoid triggering another war amid an insurgency by Sunni Muslim Arabs.
"The referendum came at a time where the country is fighting against terrorism that has come in the form of ISIL".
Baghdad and the Kurds have long-running disputes over oil exports, extraction and sharing oil revenues.
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