Australian Prime Minister John Howard and Bulgarian President Georgi Parvanov paid visits to their countries' troops in Iraq at a time when some states are withdrawing soldiers from US-led forces, who are suffering their bloodiest month.

The visits took place hours after coordinated suicide boat attacks on Iraq's primary oil export terminal, some 10km offshore from the southern city of Basra, in which three US sailors were killed.

Officials said a major disaster was averted by US-led forces in Saturday's attacks, but the terminal -- which handles about 85 percent of Iraq's 1.9 million barrels per day -- would stay shut until Monday for full damage assessment.

Iraqi Oil Minister Ibrahim Bahr al-Uloum told a news conference, however: "Exports will resume tomorrow."

Rebel Shia cleric Moqtada al-Sadr, who has spearheaded an uprising against the US-led occupation by his Mehdi Army militia and supporters, is holed up in Najaf -- a holy site to Iraq's Shia majority -- in the south of the country.

"Weapons and explosives are being hidden in schools, mosques and holy sites (in Najaf)," Iraq's US Governor Paul Bremer told Arabic television station Al Jazeera.

Bremer, whose spokesman termed the situation "potentially explosive," said Sadr's militia operating in Najaf and the nearby city of Kerbala made the situation "very difficult because these two cities are holy."

AFP adds: Town elders from the Iraqi insurgent bastion of Fallujah have written to UN Secretary General Kofi Annan asking him to mediate between militants and US troops to maintain a troubled truce, a spokesman said Sunday.

They also urged Annan to set up an international investigation into the US-led occupation of Iraq, the spokesman added.