But even as senior administration officials praised the agreement in a conference call with reporters here, members of a key Sunni bloc staged a walkout at the parliament, underscoring the deal's fragility.

After electing a Sunni as parliament speaker, about 60 members of former prime minister Iyad Allawi's Iraqiya bloc walked out to press for reinstating three fellow members who had been barred for alleged links to Saddam Hussein's regime.

US President Barack Obama and Vice President Joe Biden spoke to several Iraqi leaders in recent days to press for an agreement that would bring Allawi and his bloc into the government, senior administration officials said.

During the calls, Obama "reiterated our strong desire to see an inclusive government in Iraq, and welcomed the steps that have been taken toward reaching that goal," Deputy National Security Advisor for Strategic Communications said in a statement.

"He also stressed the need for Dr Allawi, other members of Iraqiya, and representatives from all of the winning blocs to hold leadership positions in the new national partnership government."

The agreement announced in Baghdad would return Prime Minister Nuri al-Maliki, a Shiite, to a second term; likely leave Jalal Talabani, a Kurd, as president; and elect a Sunni from Allawi's bloc as parliament speaker.

Allawi was due to head a national council on strategic policies, a position that US officials said would allow for checks on the government's direction.

"This looks like a good outcome for those working for a stable, peaceful Iraq and a bad result for those whose agenda is more sectarianism and violence," said Anthony Blinken, Biden's national security adviser.

And Rhodes said Obama "is encouraged by the substantial progress that has been made in forging an inclusive government that represents the Iraqi people and the results of this year's election."

A senior administration official said the agreement to form an inclusive government was "a strong rejection of interference of negative external influences in the region."

"Of course, I'm speaking specifically about Iran's attempts to engineer an Iraqi government that was based on a unified sectarian Shia list that would have been a narrow government and not representative of the government of Iraq," the official added.

Blinken called the power-sharing agreement "a big step forward."

"All along, we've said the best result would be a government that reflects the results of the elections, includes all the major blocs representing Iraq's ethnic and sectarian groups, and that does not exclude or marginalize anyone," Blinken added.

He said the agreement "creates real checks and balances against the abuse of power by any one group."

It would also end an eight-month-long vacuum of power accompanied by worrisome outbreaks of violence as Iraq's sectarian factions struggled to form a government in the wake of March 7 elections.

Allawi's faction won the most seats in the elections, but he failed to gain the prime minister's post.

During calls last week, Obama discussed the possibility of Kurds giving up the presidency in favor of Allawi as an option, a senior administration official said.

But in the end, the parliament speaker post combined with the chairmanship of the strategic policy council proved sufficient to bring Allawi into the new government.

The officials said negotiations remain on distributing positions before the new government can be formed.

"But the major decisions have been taken, the constitutional process has begun and you have an emerging inclusive Iraqi government that is representative of those election results for March," an official said.

But no sooner was Osama al-Nujaifi, a Sunni member of Iraqiya, elected speaker of the parliament, than members of Allawi's bloc claimed the agreement was being violated and walked out.

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