BAGHDAD (AP) – Two of Iraq’s most powerful Shiite leaders agreed on Saturday to end a bitter rivalry in a bid to end months of armed clashes and assassinations in the oil-rich south that have threatened to spread into a wider conflict.

Radical Shiite cleric Muqtada al-Sadr and Abdul-Aziz al-Hakim, leader of the largest Shiite political party, the Supreme Islamic Iraqi Council, promised to stop the bloodshed and enhance cooperation between their two movements.

An official in al-Sadr’s office in the holy city of Najaf called the agreement a “fresh start.”

Internal rivalries have been rising in recent months, particularly in the southern Shiite heartland where factions have been vying for power as the British military has pulled back to a base at the Basra airport.

The three-point agreement appeared to be aimed at reining in rival militants loyal to al-Sadr and al-Hakim before the fighting erupts into a full-fledged conflict that could shatter the relative unity of the Shiite-led governing apparatus.

It also comes as mainstream politicians from Iraq’s majority sect have been trying to bring al-Sadr back into the fold after his loyalists pulled out of the main Shiite bloc last month.

The Sadrists’ pullout left the United Iraqi Alliance, which includes al-Hakim’s SIIC, Prime Minister Nouri al-Maliki’s Dawa party and some independents, with only 85 seats – a dramatic drop for an alliance that once held 130 seats in the 275-member parliament.

Sadrist lawmaker Nassar al-Rubaie said the agreement did not change the movement’s political opposition to al-Maliki’s beleaguered government but was aimed at “preventing clashes between the two groups and reducing the violence hitting the country.”

“We have agreed to from joint committees to investigate any friction and to determine the reasons and the people behind it,” he said, stressing the need for dialogue. “The success of this agreement will mean less bloodshed.”

A copy of the agreement, signed by both leaders, was shown on the Shiite Al-Forat television station.

The principles outlined included “the necessity of protecting and respecting Iraqi blood regardless of the situation or sect,” mobilizing all Islamic and cultural institutions on both sides “to maintain friendly feelings and to avoid hatred” and to establish provincial committees aimed at keeping order.

The al-Sadr official, who spoke on condition of anonymity because he wasn’t authorized to disclose the details, called it a chance “to give up differences and take the path of stability that will serve the interests of the Iraqi people.”

The Mahdi Army militia, which is nominally loyal to al-Sadr, and the armed wing of al-Hakim’s party known as the Badr Brigade face longstanding rivalries and frequently have clashed since Saddam Hussein’s Sunni-dominated regime was ousted in 2003.

Tensions boiled over this summer with the assassination of two provincial governors belonging to SIIC, the targeting of al-Sadr lieutenants and even the shooting deaths of several aides to Iraq’s pre-eminent Shiite cleric Grand Ayatollah Ali al-Sistani.

A turning point appears to have been in late August when deadly street battles broke out between militia fighters in the holy city of Karbala, killing dozens of people during a major Shiite religious festival.

Trying to do damage control, al-Sadr announced a “freeze” of his militia activities for up to six months to allow for its restructuring. However, it is unclear how much control the youthful cleric maintains over his fighters as groups have splintered from the main movement.

The U.S. military has welcomed al-Sadr’s call for his fighters to stand down but says it will continue targeting so-called rogue elements it believes are being trained and funded by Iran.

In the latest arrest, U.S. and Iraqi troops captured a suspected Shiite militia leader accused of leading a group of 20 men who forcibly removed Sunnis from their homes north of Baghdad and destroyed their homes and farms in July.

He was seized in a raid Friday in Khalis, a Shiite enclave in the volatile Diyala province some 50 miles north of Baghdad, the military said, adding no one was killed or wounded in the raid.

The suspect, who was not identified, also was accused of ambushing a Sunni van driver, shooting him and throwing his body in the Tigris River, the military said.

Another pre-dawn raid Friday in Khalis left 25 people dead when U.S. troops called in airstrikes after meeting a fierce barrage while hunting suspected smugglers of arms from Iran to Baghdad. Village leaders said the victims included civilians, but the military insisted Saturday that the 25 killed were militants.

“We have confirmed that the 25 criminals who were killed were responsible for the attack on our forces and in fact were members of an extremist group operating in the Baqoubah region,” the military said in a statement.

Also Saturday, Baghdad provincial Gov. Hussein al-Tahan escaped unharmed when his convoy came under attack in a predominantly Sunni district in the southwest of the capital. An Associated Press Television News cameraman who was in the governor’s convoy filmed the gunbattle between governor’s guards and the attackers. No one was the convoy was known to be wounded.

Elsewhere in the capital, a roadside bomb killed a U.S. soldier and wounded three others Saturday, the military said.

In another development, the Iraqi government also announced plans to sue an Iraqi judge who led the U.S.-established Commission on Public Integrity and testified before a U.S. congressional committee last week for allegedly smuggling documents, libeling the prime minister and corruption.

Radhi Hamza al-Radhi, who is seeking asylum in the United States, has said he was forced to flee Iraq after trying to unearth instances of government fraud and abuse.

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Associated Press writers Sameer N. Yacoub and Sinan Salaheddin contributed to this report.

AP-ES-10-06-07 1526EDT