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KIRKUK, Iraq — Many in this divided city want U.S. troops to stay longer than President Barack Obama’s administration has said they will, and a tense standoff last week showed why. Kurdish troops from the north were in positions on the outskirts of Arab neighborhoods.

To calm the latest flare-up of the longstanding ethnic rivalries here has required a rush of high-level diplomacy, including phone calls from Vice President Joe Biden to Kurdish leaders and the deployment of U.S. troops, a rarity in Iraq today.

The confrontation did not turn violent — precisely, many believe, because of the presence of U.S. troops. But they will leave by the end of the year, if the current schedule stands, and many here fear that could lead to ethnic strife, even civil war.

The Kurdish soldiers, known as the pesh merga, were deployed last month by leaders in the semiautonomous northern region worried about Sunni Arab insurgents attacking peaceful demonstrators. But the action was viewed by local Arabs, U.S. diplomats and military officials, and the Iraqi government as provocative and illegal.

Kurdish officials said Monday that the troops had withdrawn as part of a deal with the Americans and the central government, although a witness in Kirkuk reported seeing the troops in their same positions, and an Arab lawmaker in the local council said that only some soldiers had left.

In the debates under way in Washington and Baghdad about where the U.S.-Iraq relationship heads after eight years of war, those who argue for a continued U.S. military presence beyond this year cite Kirkuk as the centerpiece of their case.

Perhaps the greatest unfinished chapter of America’s war in Iraq will be the status of this ancient city that today is fought over by its three main ethnic groups, Kurds, Arabs, and Turkmens, each making historical claims to the land and the oil that flows beneath.

Across Iraq, the U.S. invasion upended traditional notions of victimhood — the long-oppressed Shiites became ascendant, while the Sunni ruling elite under Saddam Hussein’s Baath Party found itself on the margins. In Kirkuk, the Kurds, who had been brutalized by the former government, have the strongest grip on power. The Arabs, many of whom were moved to the area by Hussein in his campaign to alter the demographics and dilute Kurdish influence, are fighting for their own stake in the new Iraq.