Rebel Shiite cleric Muqtada al-Sadr called Monday for his followers across Iraq to end fighting against U.S. and Iraqi forces, an al-Sadr aide said.
"(He) has called for a halting of all military operations in Iraq, and we are studying the idea of joining the political process," said Naim Al-Kaabi, an al-Sadr aide in Baghdad.
Meanwhile, Iraqi oil exports came to a halt after a rash of insurgent attacks on the country's petroleum infrastructure, the country's main source of income, senior oil company officials said.
Al-Sadr's Mahdi Army militia fought against U.S. and Iraqi forces in the holy city of Najaf for nearly three weeks before a peace deal ended the crisis there Friday.
That fighting had spread to other Shiite communities throughout Iraq, and violence continued in other areas despite the Najaf peace agreement.
The government of interim Prime Minister Ayad Allawi has demanded al-Sadr disband the Mahdi Army and join politics, which the cleric had resisted.
The announcement came as al-Sadr aides were trying to negotiate a peace agreement to end fighting in the Baghdad slum of Sadr City.
In other recent developments:
It had seemed that Sunday's talks in Sadr City failed to bring a peace agreement, with al-Sadr's aides demanding a U.S. pullout from the neighborhood, a condition U.S. officials rejected.
British forces in the southern city of Basra, also the site of recent fighting, held similar talks Sunday with al-Sadr officials there.
Though peace descended on Najaf on Friday, skirmishes continued Saturday in Baghdad, with militants firing mortars and automatic weapons at U.S. troops and tanks in the impoverished neighborhood.
In response, al-Sadr representatives, tribal leaders, Shiite politicians, government officials and U.S. military officers met to discuss the violence.
The head of the tribal negotiating team, Naim al-Bakhati, told reporters that all sides — including al-Sadr representatives — had agreed that damaged areas there be rebuilt, U.S. troops withdraw from the area except for their normal patrols and that Iraqi police be allowed to enter the slum.
As a result of recent insurgent attacks in southern Iraq, oil exports from that region have been brought to a complete halt, a senior oil official said Monday.
Oil flows out of the southern pipelines — which account for 90 percent of Iraq's exports — ceased late Sunday and were not likely to resume for at least a week, an official from South Oil Co. said on condition of anonymity.
"Oil exports from the port of Basra have completely stopped since last night," the official said Monday.
A halt in southern oil exports costs Iraq about $60 million a day in lost income at current global crude prices, said Walid Khadduri, an oil expert who is chief editor of the Cyprus-based Middle East Economic Survey.
Insurgents have launched repeated attacks on Iraq's oil infrastructure in a bid to undermine the interim government and reconstruction efforts.
The latest strikes against five pipelines linked to the southern Rumeila oil fields immediately shut down the Zubayr 1 pumping station, forcing officials to use reserves from storage tanks to keep exports flowing for several hours. The reserves ran out late Sunday, the South Oil Co. official said.
Before Sunday's attack, Iraq's exports from the south were about 600,000 barrels a day — a third the normal average of 1.8 million barrels a day due to a separate string of attacks early last week. The pipelines were still ablaze Monday, the official said.
Saboteurs last brought southern oil exports to a halt in June.