“We will all fight together from now on, Shia and Sunni. Unity is our strength,” he declared as he strode through the traditionally pro-Saddam mosque.

As the US-led coalition declared all-out war yesterday on the insurgent Shia cleric Hojatoleslam Moqtada al-Sadr, vowing to destroy his al-Mahdi Army, the two fronts — Shia in the south, and Sunni insurgents in the west and north — appeared to be coalescing with people in Baghdad’s more radical mosques calling for a holy war.

It was another bad day for the coalition, which faces the formidable task of quelling two well-armed and determined insurgencies without creating a bloodbath that would plunge the country into full-scale revolt and accelerate the unity of Shia and Sunni fighters.

After a night of relentless mortar fire in al-Kut, 100km (60 miles) to the southwest, Ukrainian troops pulled out of the town, leaving it in the hands of Hojatoleslam al-Sadr’s militia. Kazakhstan also confined its small contingent of troops to their base and announced that they would be withdrawn altogether in May.

In Karbala, where thousands of pilgrims are gathering for a Shia religious festival, Polish troops shot dead a close aide of Hojatoleslam al-Sadr in clashes. The festival of Arbayin, where about a million pilgrims are expected, could prove a rallying point for the rebels.

Amid the mounting violence, the spiritual leader of Iraqi Shias, Grand Ayatollah Ali al-Sistani, called for calm, but he was also critical of the American response.

“We condemn the way the occupying forces are dealing with current events, just as we condemn aggression against public and private property which leads to unrest and stops Iraqi officials from carrying out their duties in the service of the people,” Ayatollah al-Sistani said in a statement.

“We call for the matter to be dealt with wisdom and patience and in peaceful ways, abstaining from any provocative steps which will lead to more chaos and bloodshed.”

Despite the spiralling insurgency, the US-led coalition denied that the situation was out of control and vowed to “bring the offensive to the insurgents”.

“The coalition and Iraqi security forces will continue deliberate, precise and powerful offensive operations to destroy the al-Mahdi Army throughout Iraq,” Brigadier-General Mark Kimmit, said, insisting that most moderate Shias still support the coalition. He did admit that Shia cities such as Najaf, which is completely under rebel control, were a cause for concern.

Yet the rising death toll — more than 200 Iraqis in three days of fierce clashes — risks creating more outrage among ordinary Iraqis, already weary of the year-long occupation and the slow pace of reconstruction.

In the Abu Khanifa mosque, men, women and even children arrived to give food, money and blood for their brethren in Fallujah.

“We never thought such great and free countries would take their revenge in such a childish way,” one woman giving blood said as reports of a helicopter strike on a mosque in Fallujah caused waves of anger. “Is it acceptable to bomb a whole city for the murder of four people? Or just for Bush to be re-elected?” In the throbbing crowd, a man in dark glasses stepped forward and whispered in the ear of The Times’s translator. “I’m a Fedayin fighter and I’ve volunteered to fight in Fallujah. But I am ready to go to Najaf, too. We are ready to go and fully armed,” he muttered, before disappearing again. Young men and women, keen to vent their rage to the Western media, lined up to deliver a tidal wave of invective against President Bush, vowing to fight until their last drop of blood.

“We are giving our blood and money here now, but this is just the start. We will give our souls. This will be worse than Vietnam. The Shia and Sunni will fight together.”

Ali, a mild-mannered architect in his 40s, was the only one to voice any sign of regret over the looming jihad. “I’m sorry for the soldiers from Britain and Japan and other places. They will all be killed,” he said, adding that if the Sunni clerical leadership issued a fatwa, or edict, for a jihad, all the men and even the women would take up arms and fight. Sunni religious leaders stopped short of making such a call yesterday.

The taciturn Shia fighter, his shirt splotched in blood, was less sympathetic. “We are fighting every night in Sadr City. Their turn is coming,” he said.

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