Scores of Iraqis were killed on Tuesday during a battle for a provincial capital, and fighting shut the main oil refinery, starving parts of the country of fuel and power as an uprising by Sunni insurgents threatens Iraq's survival as a state.
Government forces said they repelled an attempt by insurgents to seize Baquba, capital of Diyala province north of Baghdad, in heavy fighting overnight.
Some residents and officials said the dead included scores of prisoners from the local jail, although there were conflicting accounts of how they had died.
ISIL fighters who aim to build a Caliphate based on medieval Sunni precepts across the Iraqi-Syrian frontier launched their revolt by seizing the north's main city, Mosul, last week and have swept through the Tigris river valley north of Baghdad. They have boasted of massacring hundreds of troops captured in their advance.
The fighters have been joined by other Sunni factions, including former members of ousted dictator Saddam Hussein's Baath Party and tribal figures, who share widespread anger among Iraq's Sunni minority at perceived oppression by the Shi'ite-led government of Prime Minister Nuri al-Maliki.
Western countries, including the United States, have urged Maliki to reach out to Sunnis to rebuild national unity as the only way of preventing the disintegration of Iraq.
But the long-serving prime minister, who won an election two months ago, seems instead to be veering in the opposite direction - relying more heavily than ever on his own majority sect and vowing to purge opposition politicians and military officers he has labelled "traitors".
Hassan Suneid, a close Maliki ally, said on Tuesday the governing Shi'ite National Alliance should boycott all work with the largest Sunni political bloc, Mutahidoon.
"It is not possible for any bloc inside the National Alliance to work with Mutahidoon bloc due to its latest sectarian attitude," he told a TV channel of Maliki's party.
The sudden advance by Sunni insurgents is scrambling alliances in the Middle East, with the United States and Iran both saying they could cooperate against a common enemy, all but unprecedented since the 1979 Iranian revolution.
U.S. President Barack Obama, under fire at home by critics who say he did too little to shore up Iraq since withdrawing troops in 2011, is considering options for military action such as air strikes. He has sent a small number of extra marines to guard the U.S. embassy but has ruled out redeploying troops.
"The president will continue to consult with his