Radicals from the Islamic State in Iraq and the Levant (Isis) have taken control of northern Iraq's most important oil refinery.
Based at Baiji near the town of Tikrit, the refinery is responsible for producing a third of Iraq's oil output. It had been under attack by the militants for the past 10 days.
The takeover comes after other significant advances made by Isis, which is seeking to gain dominance of the Shia-led country.
On Sunday, it captured three new towns and two border crossings with Jordan and Syria.
It is reported that at Baiji they offered safe passage for Iraqi troops under the condition that they gave up their weapons and left.
Yesterday, US Secretary of State John Kerry promised "intense and sustained" help in combating the rebellion.
Conversations are ongoing about possible US air strikes on the militants. According to Kerry, President Obama is currently collecting all the required information in order to make a decision.
“The president has moved the assets into place and has been gaining each day the assurances he needs with respect to potential targeting,” he said.
President Obama has so far offered 300 extra military personnel to go to Iraq and help coordinate the fight against the rebels. Last week, F-18s began surveillance flights over the region.