State Department spokesman Nicholas Burns said a U.S-brokered ceasefire between the Kurdish Democratic Party (KDP) and the Patriotic Union of Kurdistan (PUK) appeared to be generally holding since it came into effect at midnight Iraqi time on Wednesday.
He told a regular State Department news conference that Robert Pelletreau, Assistant Secretary of State for Near Eastern Affairs, would oversee talks between the two Kurdish groups in the middle of the week.
Pelletreau, who is now visiting the Gulf after mediating between the two sides in Turkey earlier this week, would return to Ankara this weekend and prepare for the talks with officials of the two Kurdish groups.
"Both will be represented at the table with him and with representatives of the governments of Turkey and the United Kingdom," Burns said. Britain and Turkey, a NATO ally that borders Iraq, have helped bring the two factions together.
Massoud Barzani's KDP, which was helped by the forces of Iraqi President Saddam Hussein when it took control of much of the Iraqi Kurdish region in September, has threatened to call on Saddam's help again in his struggle with the PUK.
The PUK has had backing from Iran and the United States feared the two months of conflict could draw in the two regional powers and further destabilise the Middle East.
Iraqi newspapers have urged the Kurds to abandon the U.S. effort and instead come to Baghdad for peace talks.
Pelletreau, with help from Turkish and British diplomats, secured the ceasefire after separate talks with Barzani and the PUK's Jalal Talabani in Turkey this week.
Witnesses near the town of Degala in Iraqi Kurdistan said the two sides traded shots after the PUK launched an attack on Wednesday morning, but fighting halted in the afternoon.
"There were some reports of sporadic fighting but that may have been a case of some of the forces ... not getting the word. It appears now the ceasefire is taking hold," Burns told a regular news briefing.
"We have hopes that these talks might lead the KDP and the PUK to maintain the ceasefire and to decide together on some form of political reconciliation so that the situation in Northern Iraq can be more stable and more peaceful," he said.
Burns said it was unclear how long the talks would last and they would have to be taken "on a day by day basis." He said Washington had employed "a lot of diplomatic muscle in the last week or so" to get the talks going.
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