A bomb killed 34 people in Baghdad's Sadr City Shi'ite slum yesterday as Iraq's minority Sunnis began the fasting month of Ramadan, which US commanders said might see a rise in sectarian bloodshed.

The bomb - most likely a car bomb, according to police - struck near a tanker distributing kerosene for stoves in Sadr City, whose poor residents are the power base of cleric Moqtada al-Sadr and his Mehdi Army militia.

In addition to the 34 people killed, 35 were injured, many badly burned. Sunni militants claimed responsibility, declaring the attack revenge for killings by the Shi'ite militia.

US commanders had warned for weeks that they expected a surge of violence to accompany the holy month, having observed similar patterns in previous years.

Shi'ites and Sunnis have separate systems for declaring Ramadan's start; Sunnis began observing it yesterday and Shi'ites are expected to begin today or tomorrow.

The Americans say they are determined to bring an end to sectarian killings in Baghdad, which have soared since an attack on a Shi'ite shrine in Samarra in February. They have put in place a system of checkpoints and some fortifications around its perimeter, expected to be ready in the next few days.