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Just several days after Canadian military leaders dismissed Iraq’s threats against the Kurds as “mostly rhetoric”, Iraqi troops launched an all-out assault on the city of Kirkuk.

Iraqi forces said they have seized the oil fields and the city on Monday. The Kurds have voted to separate from Iraq and were in control of the Kirkuk area, which is home to 40 per cent of Iraq’s oil reserves.

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Fighting started on Sunday.

The Iraqis have labelled as illegal a Kurdish referendum which called for the Kurdish region to separate from Iraq.

But the Kurds, themselves are divided and Iraq’s government was able to cut a deal with a Kurdish faction that controls key strategic points in Kirkuk.

Fighting, however, with another Kurdish faction left around 30 dead and dozens wounded, the New York Times reports. Flags belonging to the Kurdish Peshmerga were removed from the city and in their place troops installed Iraqi flags.