ARLINGTON, Va. — The war in Iraq has transformed from an insurgency into a fight between Sunni and Shiite extremists, with Iraqis turning to their local militias for security, a Defense Department report says.

The Defense Department is required to give Congress a report on stability and security in Iraq every three months.

The number of average weekly attacks on U.S. forces, Iraqi forces, and Iraqi civilians from May 20 to Aug. 11 was reported at 792, an increase of 24 percent from the average of 641 weekly attacks from Feb. 11 to May 19, officials said.

Released Friday, the report is the second consecutive report to cite a marked increase in violence.

While the Sunni insurgency remains “potent and visible,” the violence in Iraq is now defined by sectarian strife, in which civilians are dying at a rate 1,000 per month higher than in the previous three months, the report says.

“Conditions that could lead to civil war exist in Iraq. Nevertheless, the current violence is not a civil war, and movement toward civil war can be prevented,” the report says, repeating almost verbatim the recent congressional testimony of Marine Gen. Peter Pace, chairman of the Joint Chiefs of Staff.

The report attributes the most significant increases in sectarian violence to Sunni and Shiite death squads, made up of terrorists, militias and in some cases from rogue elements of Iraqi security forces.

In particular, members of the Mahdi Army, nominally under the control of radical cleric Muqtada al-Sadr, frequently make up such death squads, the report says.

Speaking to reporters Friday, officials insisted Iraqi security forces continue to make progress.

The Iraqi security forces now have about 278,000 troops and police officers, an increase of 14,000 security personnel since May, said Rear Adm. Bill Sullivan, director of the Joint Staff. The Joint Staff assists the Joint Chiefs in carrying out their responsibilities.

By the end of the year, Iraqi security forces should be at their authorized end-strength of 325,000, Sullivan said.

But while many Iraqis express confidence in Iraqi troops and police, Iraqi civilians are increasingly turning to local militias for protection from sectarian violence and social services, the report says.

“With the extended formation of the national government and capable ministries, these armed groups have become more entrenched, especially in some primarily Shia sections of Eastern Baghdad and certain Sunni neighborhoods in Western Baghdad,” the report says.

The report also notes that initial efforts by the Iraqi government to stem sectarian strife in Baghdad failed to result in a significant reduction in violence.

This summer, U.S. and coalition troops launched the first phase of Operation Together Forward in Baghdad.

But a few weeks into the operation, average weekly attacks across Iraq stood at 23.7, almost identical to the average of 23.8 attacks per week in the two months prior to the operation, the report says.

“Moreover, the rate of sectarian-motivated murders and execution-style killings continued to rise, primarily in and around Baghdad,” the report says.

Phase II of Operation Together Forward began in August involving troops with the Alaska-based 172nd Stryker Brigade Combat Team, who were extended for up to four months, along with troops from the 2nd Brigade Combat Team, 1st Armored Division, who were moved up from Kuwait.

U.S. troop strength in Iraq now stands at about 140,000, up from 127,000 earlier this summer, officials said.

Asked if U.S. and coalition forces are winning the war in Iraq, Sullivan replied, “Yeah, I think we’re making — we’re making progress, yes.”

The report also mentions improvements to Iraqi infrastructure in the last three months with an extra 1.2 million people have access to potable water and electricity averaging 14 hours per day in Iraq, an increase of three hours a day over the previous quarter.

Meanwhile, insurgent attacks against Iraqi infrastructure continue to decline, down significantly from 2004, the report says.

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