Members of the all-volunteer Iraq of Imam Hussein Regiment take up positions on a street corner as part of a basic-training course in the Iraqi holy city of Karbala. Shiite men have been ordered by Grand Ayatollah Ali Sistani, the country’s highest Shiite authority, to protect Shiite shrines and help counter the recent gains of the Islamic State of Iraq and Syria, a Sunni insurgent group.

June 28, 2014 Members of the all-volunteer Iraq of Imam Hussein Regiment take up positions on a street corner as part of a basic-training course in the Iraqi holy city of Karbala. Shiite men have been ordered by Grand Ayatollah Ali Sistani, the country’s highest Shiite authority, to protect Shiite shrines and help counter the recent gains of the Islamic State of Iraq and Syria, a Sunni insurgent group. Scott Nelson/For The Washington Post

Members of an all-volunteer force undergo training in the holy city of Karbala to protect Shiite shrines and help counter the recent gains of the Sunni insurgent group the Islamic State of Iraq and Syria.

Members of an all-volunteer force undergo training in the holy city of Karbala to protect Shiite shrines and help counter the recent gains of the Sunni insurgent group the Islamic State of Iraq and Syria.

Members of an all-volunteer force undergo training in the holy city of Karbala to protect Shiite shrines and help counter the recent gains of the Sunni insurgent group the Islamic State of Iraq and Syria.

As this country veers further toward a breakup, one group is maneuvering the crisis with far more leverage than the others: Iraqi Kurds.

Here in the contested oil-rich region of Kirkuk, Iraq’s Kurdish minority has been steadily consolidating control for weeks. On the southern edge of the province, in an area once secured by central government forces, Kurdish soldiers are reinforcing a shaky border separating them from their new southern neighbors, the Sunni militants of the Islamic State .

Massoud Barzani, president of the largely autonomous Kurdistan Regional Government, has repeatedly suggested he will soon initiatea referendum on the region’s independence, which would likely pass, local officials and analysts say.

The Kurds have already governed their territory, a land of wheat fields and rugged mountains that extends from Iraq’s northern and western border with Turkey to the Iranian border in the east, for more than two decades.

They have overseen a construction boom, built an oil industry and maintained security, even as fresh turmoil has wracked much of the rest of the country.

Yet for many Kurds, the Iraqi region of Kurdistan could never be complete without Kirkuk. Under Saddam Hussein’s brutal Arabization campaigns, many Kurds were forced to leave. The ethnically mixed area has been the flash point of a bitter territorial dispute.

On Thursday, Barzani told a closed-door meeting of the Kurdish parliament that he would only pursue independence after formalizing Kurdish control of Kirkuk and other disputed areas, according to two legislators who spoke on the condition of anonymity because of political sensitivities.

A move to annex Kirkuk could ignite fighting with Baghdad, which is intent on holding on to the territory — particularly Kirkuk’s resources — and could alienate Western allies, who fear that Iraq’s fracturing could further threaten regional security.

Washington has urged the country’s factions to work together toward forging a new government that would see the country’s Shiite Prime Minister Nouri al-Maliki step aside.

“A united Iraq is a stronger Iraq,” State Department spokeswoman Jen Psaki told reporters Wednesday.

But Iraq’s parliament failed to reach an agreement this week on the government’s top posts.

In a statement Friday, Maliki reminded Iraqis that his party holds the largest majority in parliament and that it would not accept “conditions” set by opposition members, despite escalating pressure to step aside. “I will never give up my candidacy for the post of prime minister,” he said.

The country’s top Shiite cleric, Ayatollah Ali Sistani, who has appeared to endorse Maliki’s removal, issued a statement Friday calling the political deadlock “a regrettable failure.”

Meanwhile, scattered fighting and airstrikes continued across the country as Iraq’s Shiite-dominated armed forces, with the help of Shiite militias, struggled to recapture territory seized by the Islamic State.

On Friday, the army reclaimed control of Saddam Hussein’s birthplace of Awja, a Sunni Arab stronghold north of Baghdad, the Iraqi armed forces and residents told Reuters. But several days of attacks have so far failed to dislodge the militants from the larger city of Tikrit, just north of Awja, and other areas they control.

In the Kurdish regions in particular, Iraqis of all ethnicities and religions talk increasingly of the emergence of three states.

“The United States really has to be realistic,” said Najmiddin Karim, the Kurdish governor of Kirkuk. “This thing about ‘sovereignty,’ this thing about the borders of Iraq, Iraq ‘unity’— I mean this is just an old story.”

But to effectively manage their own country, the Kurds need a reliable cash flow. Baghdad still controls the region’s budget, which has gone unfunded for the past six months amid disputes over oil and turf. Kurdish leaders say they have had to borrow billions to pay salaries.

The Kurds have begun to establish an independent revenue stream by building their own oil sector. In May, they began exporting through a new pipeline to Turkey, bypassing Baghdad’s control — sales that have so far garnered $93 million, according to Turkish Energy Minister Taner Yildiz.

But to replace the money the Kurds have customarily received from Baghdad — about $1 billion per month — they need to raise their oil sales dramatically. The enormous oil fields of Kirkuk, newly secured by the Kurds, can currently produce more oil than all the other fields in the Kurdistan region combined.

In the past, the federal government has exported Kirkuk’s oil through a pipeline to Turkey, which is now inoperable because it runs through territory controlled by the Islamic State.

The Kurds are now building a new pipeline that will link Kirkuk with the Kurdistan region’s independent pipeline to Turkey, according to both Kurdish leaders and technical officials from Iraq’s federal North Oil Co., which has historically managed Kirkuk’s oil. The project is at least three months from completion, North Oil Co. officials said.

But getting the pipeline up and running is more about political will than technical capabilities. Kurdish leaders have negotiated with the federal oil ministry over how they might help export Kirkuk oil, but they have not agreed on terms.

“Nobody wants a war with Baghdad, so this will have to be done carefully,” a senior Kurdish official said, speaking on the condition of anonymity because of political sensitivities.

Ramzy Mardini, an Iraq expert and nonresident fellow at the Atlantic Council, said he believes the Kurds are pushing for economic gains and greater control, without having to shoulder the responsibilities of full statehood.

“They’re looking to extract the economic benefit from Kirkuk and consolidate their hold on the city, without running for the exit,” Mardini said.

An independent Kurdistan would have to effectively manage Kirkuk’s ethnically and religiously diverse population—a microcosm of Iraq’s larger divisions.

The province’s Kurdish governor is widely popular, and Sunni Arabs and Turkmen residents of Kirkuk said in interviews that they were pleased with the new Kurdish hold on the city, citing better security than they had under Maliki.

But some Arabs expressed concern that Kurdish political leaders could monopolize power should Kirkuk become part of a fully independent Kurdish state.

“People are safe but afraid,” said Sami Najim, a Sunni Arab grocery store owner. “The only people who have benefitted in the past are the Shiites and the Kurds.”

Van Heuvelen reported from Irbil, Iraq.