Fifteen protesters have been killed and Iraq has declared a nationwide curfew after supporters of Moqtada al-Sadr stormed the government palace in Baghdad's Green Zone today following the powerful Shi'ite leader's declaration that he was quitting politics.

At least 270 protesters have been injured.

Shots were fired in the fortified area, which houses government buildings as well as diplomatic missions, as tensions soared amid an escalating political crisis that has left Iraq without a new government, prime minister or president for months.

The army announced a nationwide curfew from 7pm (1600 GMT), after earlier declaring a Baghdad curfew that demonstrators ignored.

Medics told AFP that eight Sadr supporters were killed and 85 others wounded after clashes broke out in the Green Zone.

Witnesses said Sadr loyalists and supporters of a rival Shi'ite bloc, the pro-Iran Coordination Framework, had exchanged fire.

Security forces later patrolled the capital.

Calling the developments "an extremely dangerous escalation", the United Nations Assistance Mission in Iraq (UNAMI) urged "all" sides to "refrain from acts that could lead to an unstoppable chain of events".
"The very survival of the state is at stake," it warned.

The United States also urged calm amid the "disturbing" reports of unrest in Baghdad.

Protests later spread to other parts of the country, with Sadr followers storming government buildings in the southern cities of Nasiriyah and Hillah.

Moqtada al-Sadr insisted on early elections and the dissolution of parliament (File photo)

'Definitive retirement'

Iraq has been mired in political deadlock since legislative elections in October last year, due to disagreement between Shi'ite factions over forming a coalition.

Shortly after he made his surprise declaration, MR Sadr's followers burst into the Republican Palace, where cabinet meetings are usually held.

Inside the opulent palace, protesters lounged in armchairs in a meeting room, some waved Iraqi flags and took photographs of themselves, and others cooled off in a swimming pool in the garden, in scenes reminiscent of anti-government protests in Sri Lanka last month.

Moqtada al-Sadr, a preacher with millions of devoted followers who once led a militia against American and Iraqi government forces, announced earlier today on Twitter that he was stepping back from politics.

"I've decided not to meddle in political affairs. I therefore announce now my definitive retirement," said Mr Sadr, a longtime player in the war-torn country's political scene, though he himself has never directly been in government.

He added that "all the institutions" linked to his Sadrist movement will be closed, except the mausoleum of his father, assassinated in 1999, and other heritage facilities.

His latest statement came two days after he said "all parties" including his own should give up government positions in order to help resolve the political crisis.

His bloc emerged from last year's election as the biggest, with 73 seats, but short of a majority. In June, his politicians quit in a bid to break the logjam, which led to the Coordination Framework becoming the largest bloc in the legislature.

Since then, Mr Sadr has engaged in other pressure tactics, including a mass prayer by tens of thousands of his followers on 5 August.

Hamzeh Hadad, from the European Council on Foreign Relations (ECFR), said it was "not clear" what Mr Sadr's strategy was.

"Whatever it does mean, in typical Sadrist fashion, there is always backtracking expected," Mr Hadad said.

"The second, and more terrifying thought on this is that he is giving his followers the green light to do whatever they like."

Supporters of Moqtada Sadr gather inside the Government Headquarters in the Green Zone

Millions of followers

Mr Sadr's supporters have been calling for parliament to be dissolved and for new elections, but on Saturday the cleric said it was "more important" that "all parties and figures who have been part of the political process" since the 2003 US-led invasion "no longer participate".

"That includes the Sadrist movement," he said.

Over the years, the chameleon-like Mr Sadr has taken various positions and then reversed them.

His supporters have for weeks been staging a sit-in outside Iraq's parliament, after storming the legislature's interior on July 30, to press their demands.

They were angered after the Coordination Framework nominated a candidate they saw as unacceptable for prime minister.

The Framework wants a new head of government to be appointed before any new polls are held.

Caretaker Prime Minister Mustafa al-Kadhemi earlier this month convened crisis talks with party leaders, but the Sadrists boycotted.

Many Iraqis say the political infighting has nothing to do with their day-to-day struggles.

Iraq has been ravaged by decades of conflict and endemic corruption.

Oil-rich but blighted by ailing infrastructure, unemployment, power cuts and crumbling public services, Iraq now also faces water shortages as drought ravages swathes of the country.