A bomb attack on a tea house in the ethnically mixed Iraqi city of Kirkuk killed at least 31 people on Friday, police and medics said.

The blast tore through the tea shop where people had gathered after breaking their fast for Ramadan in a southern district of Kirkuk, 250 km north of the capital Baghdad.

The violence is part of a sustained campaign of militant attacks since the start of the year that has prompted warnings of wider conflict in a country where ethnic Kurds and Shi'ite and Sunnis have yet to find a stable power-sharing compromise.

"I left the cafe to go to my shop opposite. When the explosion happened the glass of my shop shattered and I was injured by the fragments. I rushed to the scene ... some bodies were dismembered," said Mohammed, a witness to the blast in the district of Wahed Huzeiran.

Kirkuk is rich in oil and lies on the front line of a dispute between the Shi'ite-led central government in Baghdad and ethnic Kurds who want the city to be incorporated into their autonomous region in the north of the country.

A referendum to determine Kirkuk's status was supposed to be conducted in 2007, but political discord prevented it being carried out.

The city is located in a band of territory known as the "disputed areas" that run along the contested internal boundary between the Kurdistan region and Arab Iraq, stretching from Syria in the west to Iran in the east.-Reuters