British troops in riot gearhave clashed with Iraqi civilians in Basra as disturbances spread over shortages of petrol and power in Iraq's second city.
In one instance, witnesses said soldiers fired in the air to keep back a crowd at a petrol station. Another witness said the British fired baton rounds at a crowd, wounding two Iraqis.
A British military spokesman said several soldiers received minor injuries from stones and a military vehicle was set alight. He had no information on Iraqi injuries or casualties.
"We put crowd control measures in place at petrol stations to try to restore law and order," spokesman Jonathan Spencer said. "The situation is beginning to calm down."
It was the second major unrest against British troops in the past three months. In June, six British soldiers were killed in the Shi'ite town of Majjar by armed Iraqis protesting against house-to-house searches.
Occupation force officials met local leaders, and British commanders blamed the shortages on oil smuggling, sabotage and looting. British forces also seized a tanker overnight, which they said was smuggling diesel oil out into the Gulf by sea.
Several streets and main roads leading into the city were blocked as black smoke rose from the fires. By late afternoon, many of the British forces appeared to have withdrawn leaving large parts of the city of two million in the hands of rioters.
Witnesses said angry Iraqis threw stones, burned tyres and attacked cars registered in nearby Kuwait, which local people accuse of buying up diesel oil smuggled across the desert.
"All the disasters that have come upon us are because of Kuwait and Kuwaitis," said one man, Abu Hassan, as a mob attacked Kuwaiti-registered vehicles.
"The British have been here four months and things have not improved. Now we have shortages in everything."
British officials said they were doing all they could to stamp out oil smuggling and the sabotage and looting of power cables that have left electricity supply at "minimal" levels, depriving Basra of refrigeration and air conditioning as summer temperatures soar above 50 degrees (122 Fahrenheit).
The shortage of diesel oil has meant residents, businesses and hospitals have difficulties running their generators.