CBS News Correspondent Cami McCormick reports coalition spokesman Dan Senor called al-Sadr's cease-fire offer only a first step, but said officials are cautiously optimistic. They will suspend offensive operations and if the peace holds, eventually withdraw many U.S. forces to bases outside the city.
Iraqi leaders had urged the Americans to accept the agreement, which was announced by the Iraqi government early Thursday. The agreement does not require al-Sadr immediately to disband militia and turn himself in to authorities to face charges in the April 2003 assassination of a moderate cleric — key U.S. demands to end the standoff.
Instead, the future of al-Sadr's al-Mahdi Army and the status of the arrest warrant will be discussed during talks between the cleric and the Shiite religious and political leaders. That makes it unlikely that either step will be taken until sovereignty transfers from the coalition to a new Iraqi government at the end of next month.
In other developments:
Al-Sadr launched his uprising after the occupation authority launched a crackdown on his movement. An Iraqi judge has issued an arrest warrant charging him al-Sadr in the 2003 assassination of moderate cleric Abdul Majid al-Khoei.
The revolt has stirred up violence in formerly peaceful Shiite areas south of Baghdad, further challenging U.S.-led forces who were already battling Sunni Muslim insurgents in central, western and northern Iraq.
American commanders have been eager to quell the violence before they return sovereignty to a new Iraqi government on June 30.
Al-Sadr said he was making the truce offer because of "the tragic condition" in Najaf after weeks of fighting and the slight damage suffered by the city's holiest shrine, the Imam Ali mosque.
It wasn't known how much al-Sadr was swayed by the pre-dawn raid in which U.S. troops arrested al-Sadr's key lieutenant, Riyadh al-Nouri — a major blow to the al-Mahdi Army.
Mohammed al-Musawi, one of several Shiite figures who have been trying to arrange a peaceful end to the standoff, said the Najaf deal included transforming al-Sadr's militia into a political organization, creating a new security organization to protect the city, delaying prosecution of al-Sadr until an elected government takes office next year, withdrawing U.S. forces from Najaf, and ending the open display of weaponry on the streets.
A Shiite member of the Governing Council, Abdul-Karim Mahoud al-Mohammedawi, warned that arresting al-Sadr would "complicate the issues" and lead to "an unending revolution."
Iraq's national security adviser, Shiite Mouwafak al-Rubaie, declined to say whether the discussions could lead to throwing out charges against al-Sadr or even the disbandment of his militia.
Asked if al-Sadr might have a political role in the new Iraq, al-Rubaie said: "I do not see any reason that prevents any political movement that uses democratic means and political activities from being part of the Iraqi state and from participating in the building of Iraq."
Fighting around some of the holiest cities of Shia Islam has angered many Shiites in Iraq and elsewhere and has led to calls for both sides to pull back from the shrines. On Tuesday, the Imam Ali shrine in Najaf was slightly damaged, and both U.S. and Shiite forces blamed the other.
At the United Nations, a three-page proposal by China — which diplomats said was supported in large part by Russia, France and Germany — would give the interim government control over the Iraqi army and police and require the multinational force to consult on military actions except for self-defense.
It would also give the new Iraqi leaders, who will take power June 30, the right to decide whether foreign forces remain in the country and limit the multinational force's mandate to January 2005, when elections are expected to be held for a transitional government.
Under the U.S.-British draft resolution, a sovereign interim Iraqi government will "assume the responsibility and authority" for governing the country by June 30, but its powers aren't spelled out.