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Another resident, Haidar al-Taie, said a warplane was dropping barrels packed with explosives on militant positions inside the city on Monday morning and many Shiite families had left the town shortly after fighting broke out on Sunday.

“Residents are gripped by fear and most of them have already left the town for areas held by Kurdish security forces,” al-Abadi said. The city lies just south of the self-rule Kurdish region and many residents were fleeing to the relatively safe territory, joining an influx of refugees from Mosul and other areas that have been captured by the militants.

Some 3,000 others from Tal Afar fled west to the neighboring town of Sinjar.

Throughout the past decade since the 2003 U.S.-led invasion of Iraq, Tal Afar was often hit by car bombings and other attacks by Sunni militants, targeting its Turkomen minority. At one point, after a major American offensive to drive out insurgents, then-President George W. Bush in 2006 declared Tal Afar a success story that shows “the outlines of the Iraq that we and the Iraqi people have been fighting for … A free and secure people are getting back on their feet.”

Since last Monday, Islamic State fighters and their insurgent allies have swept down from Mosul capturing a swath of territory at least 120 miles (200 kilometers) long toward Baghdad, and they vow to assault the capital itself. The stunning turn of events in Iraq, 2 ½ years after the U.S. military withdrew from the country is threatening long-established borders and raising alarm in Washington, Turkey and other neighboring countries.

Perhaps no greater sign of the alarm is the fact that the United States would consider working with Iran against the insurgents - despite years of efforts to limit influence by the neighboring Shiite-dominated powerhouse in Iraq.

Iran now could take a similar role in Iraq that it plays in Syria, where its support - along with that of Iraqi and Lebanese Shiite fighters on the ground - has been crucial to Assad’s survival.

Kerry said Monday in an interview with Yahoo! News that Washington is “open to discussions” with Tehran if the Iranians can help end the violence and restore confidence in the Iraqi government.

Kerry also said that U.S. drone strikes “may well” be an option.

U.S. officials said earlier there is a possibility that a senior American diplomat may discuss Iraq with an Iranian delegation at nuclear talks in Vienna.

Iranian-backed Iraqi Shiite militias, along with thousands of other volunteers, joined Iraq’s security forces to prepare for what Prime Minister Nouri al-Maliki - a Shiite close to Iran - has vowed to be a fight to liberate every inch of Iraqi territory from the insurgents.

Militants on Monday ambushed a vehicle carrying off-duty soldiers to Samarra, a city north of Baghdad that is a key battleground with the militants and is home to a much revered Shiite shrine. Six soldiers were killed and four wounded in the attack, a government official said.

Security has been tightened around Baghdad, particularly on its northern and western edges, and food prices have dramatically gone up because of the transportation disruptions on the main road heading north from the capital.

Thousands of Shiites are already heeding a call from their most revered spiritual leader, the Iranian-born Grand Ayatollah Ali al-Sistani, to take up arms against the Sunni militants.

“We will march and liberate every inch they defaced, from the country’s northernmost point to the southernmost point,” al-Maliki told volunteers on Sunday. The volunteers responded with Shiite chants.

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