Iraq's president formally asked Prime Minister Nuri Al-Maliki on Thursday to form a new government, giving him 30 days to choose a cabinet.

The request from President Jalal Talabani came two weeks after political leaders reached an agreement to divide up the top government jobs, a deal that put Al-Maliki, a Shi'ite, on track for a second term as premier.

The power-sharing pact, more than eight months after an inconclusive March 7 parliamentary election, offered some hope that Iraq could avoid a return to the sectarian warfare that killed tens of thousands of people at its peak in 2006-07.   

'I am addressing the great Iraqi people, all its religions, sects and nationalities, and our brothers the politicians, about the necessity to work to overcome the disputes from the past, to put them behind us and to open a new page,' Al-Maliki said in a ceremony at the presidential palace in Baghdad.   

Among his biggest decisions are his choices to head the oil and finance ministries. Iraq is trying to rebuild its battered infrastructure and sagging oil industry after years of war, international economic sanctions and neglect and depends on oil revenues for about 95 percent of its federal budget.   

The oil ministry, which has signed a raft of deals with global petroleum companies in the past year in a bid to vault Iraq back into the top echelon of producers, is led by Hussain Al-Shahristani, a close Al-Maliki ally and a leader in his newly formed National Alliance.

'All ministries are important, but the National Alliance is interested in getting the oil ministry, then the finance ministry,' said a senior lawmaker in Al-Maliki's coalition who asked not to be named.        

The Opec producer aims to ramp up crude output capacity to 12 million barrels per day from the current 2.5 million, which could boost it into the top tier with leader Saudi Arabia.   

At the same time, Al-Maliki's government is fighting a weakened but still lethal Sunni Islamist insurgency. Bombings and other attacks have fallen significantly in frequency from the height of the sectarian slaughter, but still occur daily.   

The long political impasse after an election that produced no clear winner stirred concerns about increased violence from militants trying to take advantage of a power vacuum.   

After his mainly Shi'ite State of Law alliance came second in the election with 89 seats, Al-Maliki won a lengthy political fight for the premier's job by cobbling together an alliance of Shi'ite factions, cementing support from Shi'ite neighbour Iran.   

He then won the backing of Kurdish lawmakers and from parts of the Sunni-backed Iraqiya alliance headed by his chief rival, former premier Iyad Allawi.   

Cross-sectarian Iraqiya won 91 seats but Allawi was unable to reach agreement with others for a parliamentary majority.   

Al-Maliki toured regional capitals last month to win backing for a second term, offering Arab neighbours investment deals in Iraq in exchange for pushing Iraqiya towards a compromise, political sources said.  

Senior leaders from Iraqiya have said they want the foreign affairs ministry, currently held by a Kurd, Hoshiyar Zebari.   

But Iraqiya faces rifts within its ranks that may affect its bid for the ministry. Kurdish lawmakers want to keep it.

'We prefer to get the foreign ministry as a sovereign ministry because of the successes that we had the last four years. But if not, we will ask for the finance ministry instead,' senior Kurdish official Adel Barwari said.   

The Kurds' lack of seats may cost them a chance at the foreign ministry, Kurdish officials have said. The power-sharing deal reached on Nov 10 gave Talabani, a Kurd, another term as president and installed Sunni lawmaker Osama Al-Nujaifi, a member of Iraqiya, as speaker of parliament.

Allawi, who wanted Al-Maliki's job, was to become head of a council for strategic policies that has yet to be created. - Reuters