Iraqi Prime Minister Nuri al-Maliki says government forces are "regaining the initiative and striking back" after militants from an Al-Qaeda splinter group seized large swaths of territory in the north of the country.
In a televised address on June 18, Maliki, a Shi'ite, said the "shock" of the militants' advance in the mainly Sunni north has helped restore Iraq's national unity.
Maliki admitted the army had suffered a setback, but said that "not every setback is a defeat."
Militants spearheaded by the Islamic State of Iraq and the Levant (ISIL, also known as ISIS) have seized the key cities of Mosul and Tikrit after launching their offensive earlier this month and pushing toward Baghdad.
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On June 18, Government forces said they had regained parts of the strategic Shi'ite-majority town of Tal Afar near the Syrian border and repelled an attack on the oil refinery in Baiji, north of Baghdad.
The army said 40 militants were killed in fighting at Baiji, but the claim could not be independently confirmed.
Saudi Foreign Minister Prince Saud al-Faisal on June 18 said the deteriorating security situation in Iraq shows signs of a "civil war."
Iraq's government has accused Sunni Saudi Arabia of financing the militants.
On June 18, Iranian President Hassan Rohani said his country, Saudi Arabia's regional rival, would do whatever it takes to protect Shi'ite holy sites in Iraq against the Sunni militants.
India's Foreign Ministry, meanwhile, said 40 Indian construction workers have been abducted near the northern city of Mosul.
Turkish media reports said 60 foreign construction workers, including some 15 Turks, were reported abducted by ISIL militants near the northern oil city of Kirkuk.
Last week, 80 Turkish nationals were seized near Mosul, 49 of them from the Turkish consulate in the city.
U.S. President Barack Obama is considering military options to push back the ISIL. But in return Washington wants Maliki to address concerns of the minority Sunnis, which ISIL has exploited to win support.
With reporting by AP, AFP, and Reuters