CIA officers in Iraq are warning that the country may be on a path to civil war, current and former U.S. officials said Wednesday, starkly contradicting the upbeat assessment that President Bush gave in his State of the Union address.

The CIA officers’ bleak assessment was delivered verbally to Washington this week, said the officials, who spoke on condition of anonymity because of the classified information involved.

The warning echoed growing fears that Iraq’s Shiite majority, which has until now grudgingly accepted the U.S. occupation, could turn to violence if its demands for direct elections are spurned.

Tens of thousands of Shiite Muslims protest in the streets Baghdad, Iraq. The protesters are demanding a fair election process for Iraq.

Meanwhile, Iraq’s Kurdish minority is pressing its demand for autonomy and shares of oil revenue.

“Both the Shiites and the Kurds think that now’s their time,” said one intelligence officer. “They think that if they don’t get what they want now, they’ll probably never get it. Both of them feel they’ve been betrayed by the United States before.”

These dire scenarios were discussed at meetings this week by Bush, his top national security aides and the chief U.S. administrator in Iraq, L. Paul Bremer, said a senior administration official, who requested anonymity.

Another senior official said the concerns over a possible civil war weren’t confined to the CIA but are “broadly held within the government,” including by regional experts at the State Department and National Security Council.

Top officials are scrambling to save the U.S. exit strategy after concluding that Iraq’s most powerful Shiite cleric, Grand Ayatollah Ali al Husseini al Sistani, is unlikely to drop his demand for elections for an interim assembly that would choose an interim government by June 30.

Bremer would then hand over power to the interim government.

The CIA hasn’t yet put its officers’ warnings about a potential Iraqi civil war in writing, but the senior official said he expected a formal report “momentarily.”

“In the discussion with Bremer in the last few days, several very bad possibilities have been outlined,” he said.

Bush, in his State of the Union address on Tuesday, insisted that an insurgency against the U.S. occupation, conducted primarily by minority Sunni Muslims who enjoyed power under Saddam Hussein, “will fail, and the Iraqi people will live in freedom.”

“Month by month, Iraqis are assuming more responsibility for their own security and their own future,” the president said.

Bush didn’t directly address the crisis over the Shiites’ political demands.

Shiites, who dominate the regions from Baghdad south to the borders of Kuwait and Iran, comprise some 60 percent of Iraq’s 25 million people.

Several U.S. officials acknowledged that Sistani is unlikely to be “rolled,” as one put it, and as a result Bremer’s plan for restoring Iraqi sovereignty and ending the U.S. occupation by June 30 is in peril.

The Bremer plan, negotiated with the U.S.-installed Iraqi Governing Council, calls for caucuses in each of Iraq’s 18 provinces to choose the interim national assembly, which would in turn select Iraq’s first post-Saddam government.

The first direct elections wouldn’t be held until the end of 2005.

In an interview with Knight Ridder on Wednesday, a top cleric in the Shiite holy city of Najaf appeared to confirm the fears of potential civil war.

“Everything has its own time, but we are saying that we don’t accept the occupiers getting involved with the Iraqis’ affairs,” said Sheikh Ali Najafi, whose father, Grand Ayatollah Bashir al Najafi, is, along with Sistani, one of the four most senior clerics. “I don’t trust the Americans—not even for one blink.”

If the United States went ahead with the caucus plan and ended the military occupation, the interim government wouldn’t last long, he said.

“The Iraqi people would know how to deal with those people,” he said, smiling. “They would kick them out.”

U.S. and British officials hinted Wednesday that they might bow to the demand for some kind of elections, after saying for weeks that holding free and fair elections in time for the handover of sovereignty would be impossible.

“We’ve always favored elections,” Defense Secretary Donald H. Rumsfeld said after he and other top Bush aides briefed senators. “The only question is—the tension was, if your goal is to get sovereignty passed to the Iraqis so that they feel they have a stake in their future, can you do it faster with caucuses or can you do it faster with elections?”

Rumsfeld was responding to comments by British Foreign Secretary Jack Straw, who opened the door Wednesday to elections in Iraq earlier than planned.

“The discussion, which has been stimulated by Ayatollah Sistani, is whether there could be an element of elections injected into the earlier part of the process,” Straw said at the World Economic Forum in Davos, Switzerland.

“We have to work with great respect for him and similar leaders,” he said. “We want elections as soon as it is feasible to hold them.”

Shiite clerics have become more forceful in their denunciation of the caucus plan and have organized increasingly large, albeit peaceful, demonstrations demanding elections.

State Department officials said no changes to the Bremer plan are being formally considered. They said much depends on the findings of a U.N. assessment team that the Bush administration has asked U.N. Secretary-General Kofi Annan to send to examine the feasibility of elections.

One option being informally discussed is to delay the transfer of power until later in 2004, which might give the United Nations time to organize some sort of elections, said one official.

But that is almost certain to be opposed by White House political aides who want the occupation over and many U.S. troops gone by this summer to bolster Bush’s re-election chances, the official said.

“It’s all politics right now,” he said.

Other options are to go ahead with the June 30 turnover as planned, whatever the fallout, or to accelerate it by handing over power to the Iraqi Governing Council in March or April, he said.

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Knight Ridder Newspapers correspondents Tom Lasseter in Najaf, Iraq, and Joseph L. Galloway and John Walcott in Washington contributed to this report.

—Knight-Ridder, January 22, 2004