Top Shiite cleric Grand Ayatollah Ali al-Sistani, revered among Iraq's majority community, warned that time was running out to expel the jihadists, who have spearheaded the offensive that has seen Sunni Arab militants seize a vast swathe of northern and north-central Iraq.
Obama, who based his political career on ending US involvement in Iraq, insisted the United States was not slipping back into the morass, and warned Prime Minister Nuri al-Maliki and his Shiite ally Iran that promoting sectarianism would spell disaster.
Tehran hit back, saying that Obama lacked a "serious will" to fight terrorism after he left unheeded a request from Baghdad for US air strikes against the militants.
The assault, led by the jihadist Islamic State of Iraq and the Levant (ISIL) group but also involving loyalists of executed Sunni Arab dictator Saddam Hussein, has further threatened Washington's already-damaged legacy in Iraq.
"Going forward, we will be prepared to take targeted and precise military action if and when we determine that the situation on the ground requires it," Obama said yesterday, as he announced the offer of up to 300 military advisers.
The offer was the most concrete action announced by Washington since the crisis erupted on June 9 but fell short of Iraq's request for air strikes and drew derision from Iran, which had offered its cooperation despite decades of enmity.
"Delaying the fight against terrorism and ISIL and putting conditions on it have fuelled suspicions and doubts about the United States' objectives in Iraq," Deputy Foreign Minister Hossein Amir Abdollahian said.
"Obama's comments show the White House lacks serious will in fighting terrorism in Iraq and the region."
Top cleric Sistani called for Iraqis to band together against the jihadists before it is too late. If ISIL is not "fought and expelled from Iraq, everyone will regret it tomorrow, when regret has no meaning," his spokesman announced on his behalf.
The battle for the strategic northern town of Tal Afar entered its sixth day today, with witnesses saying security forces clashed with militants who still hold significant ground.
Shiite-majority Tal Afar is located along a strategic corridor to Syria, and is the largest town not to fall to militants in the northern province of Nineveh, most of which has been overrun.