a few hours before they went in.

Al-Maliki clearly fears that Moqtada will win the provincial elections due later this year - and that they will deliver him real power over Basra and its oil.

What concerns al-Maliki and the US neo-cons is Moqtada's interpretation of Iraq's new oil law - which they believe is likely to favour Tehran rather than Baghdad in the commercial development of common fields and common pipelines. The law is deliberately ambiguous about exploitation of fields which run across national boundaries. The oil minister, Hussein Shahrastani, whose ancestry is from Iran, has kept silent about what happens to oil fields that extend into Iran - where there are already accusations of the Iranians pumping oil from under Iraq.

The American hawks under Dick Cheney fear that Moqtada's propaganda win in Basra will be linked to Iran's recent successes in energy politics. A further blow to the White House policy of isolating Iran by sanctions was a deal struck by the Swiss last month to buy 194tr cubic feet of gas from Iran annually

from 2011. It was sealed at a ceremony in Tehran where Micheline Calmy-Rey, the Swiss foreign minister, was photographed shrouded in a headscarf, smiling and shaking the hand of President Ahmadinejad.

Ironically, the Americans' favourite Shia leader, Abdul Aziz al-Hakim, would likely be no less pro-Iranian than Moqtada when it comes to oil. Al-Hakim wants to see Iraq become a loose federation, with Basra at the centre of a southern super-region. In Tehran, that is seen as an opportunity for closer ties, possibly even the use of Iranian pipelines and ports to transport Iraqi oil.

So the oil card is slipping from Washington's hand, thanks to the misjudgment of al-Maliki in attacking Moqtada's militias. In the dying days of the Bush regime, fears are growing again that if the America can't win the oil contest, it will resort to force - even the bombing of Iran. At least the main regional leaders, Turkey, Egypt and Saudi Arabia, have told Dick Cheney they won't go along with such a suicidal move.