Oct. 24 (Bloomberg) -- Turkey's military attacked Kurdish fighters in northern Iraq today as a senior U.S. defense official asked Iraqi authorities to ease the crisis by stopping the fighters from moving across the border into Turkey.

The official, while declining to say what the U.S. would do if the Iraqis failed to act, said there was growing sympathy among top American leaders for the Turkish position that action must be taken to curb the Kurdish guerrillas. The official briefed reporters in Washington on condition of anonymity.

Turkish F-16 jets and helicopters strafed positions along the Iraqi border, the state-run Anatolia news agency in Ankara said, in a fourth day of fighting. The campaign came to light today. Soldiers on the Turkish side located hideouts of the Kurdistan Workers' Party, or PKK, seizing weapons and supplies.

Turkey has vowed a military incursion into northern Iraq to end the threat posed to its security by the PKK, which is designated a terrorist group by the U.S. and European Union. The U.S. has cautioned Turkey against mounting a full-scale military assault, saying it will destabilize the calmest part of Iraq.

``We are concerned about the continuing skirmishes,'' White House spokeswoman Dana Perino told reporters in Washington today. ``We continue to urge both sides to exercise restraint.''

Turkish F-16 fighter planes were spotted over the northern Iraqi town of Dohuk, about 60 kilometers (37 miles) from the border, as they embarked on bombing runs against the militants, CNN Turk television said, citing an eyewitness.

The North Atlantic Treaty Organization, to which Turkey belongs, voiced ``full solidarity'' with the Turkish government and said its military is acting with ``restraint'' in striking at Kurdish rebels in Iraq.

Visible Steps

The senior U.S. official said he expects Iraq's national government and the Kurdish regional government that controls northern Iraq to take what he called concrete, tangible and visible steps to curb the PKK.

The official mentioned interdicting PKK logistical lines and curtailing the fighters' freedom of movement as among those steps the U.S. wanted taken. Such steps would make it more difficult and perhaps impossible for the PKK to mount cross- border raids, the official said.

Asked about the likelihood that the Kurdish regional government would take such steps, the official said that government has made positive statements in that direction. The test will be whether those statements are backed up by action, the official said.

Another U.S. official, Assistant Secretary of State Daniel Fried, told reporters in Berlin today: ``Iraq has to do more. Both the Iraqi and the Kurdish regional government have to do more.''

Past Incursions

The PKK has fought the Turkish military at the cost of almost 40,000 lives, most of them Kurdish, during the past two decades. Turkey carried out major incursions into northern Iraq in 1995, with almost 40,000 troops, and in 1997, with tens of thousands. Turkey's parliament on Oct. 17 passed a resolution authorizing the government to send troops into Iraq to attack PKK positions there.

Turkish jets and artillery had pounded at least 63 suspected rebel positions inside the Kurdish-controlled region from Oct. 21 until yesterday, a Turkish lawmaker said.

The army sent 300 commandos into Iraq by helicopter on Oct. 21 to hunt down PKK fighters after 12 soldiers were killed by the group the same day, the official said. The attack on PKK bases up to 40 kilometers (25 miles) into Iraq lasted about 28 hours before troops returned to the Turkish side, he added.

``These military operations will continue and perhaps the Turks will start economic sanctions against Iraq too,'' said Wolfango Piccoli, a political risk analyst at Eurasia Group in London. ``The government really needs to do something more substantial to satisfy public opinion.''

Lined Up

About 80,000 Turkish troops are now lined up along the border with Iraq, the lawmaker said.

PKK militants have killed 42 Turkish soldiers and civilians this month. Tens of thousands of Turks protested in cities across the country this week, calling for an immediate military incursion into Iraq and chanting anti-PKK slogans.

Turkey killed one PKK fighter in the province of Malatya yesterday and found a cache of weapons including rocket launchers and plastic explosives in Hakkari, adjacent to the border with Iraq, the army said on its Web site today.

Turkey's stock index dropped as much as 1.5 percent in Istanbul. Shares rose yesterday on hopes for a diplomatic solution to the conflict.

Weighs on Lira

The prospect of Turkish military intervention in Iraq has brought the Turkish lira's biggest rally in at least 30 years to a standstill. The lira has depreciated 2.5 percent since reaching a record high of 1.18 against the dollar on Oct. 10.

Turkish military helicopters and jet fighters flew over Turkey's mountainous southeast toward the Iraqi border today from an airbase at Diyarbakir, about 180 kilometers (110 miles) from Iraq, eyewitnesses said. Soldiers at roadblocks were checking the identities of motorists entering the Hakkari province, where the 12 soldiers were killed.

The Bush administration is sharing intelligence with Turkey's government in its fight against the PKK, Perino said yesterday.

``We think that the Turks are thinking through their best options for defending themselves,'' Fried, assistant secretary of state for European and Eurasian Affairs, said in an interview. As well as the shelling of PKK positions, Turkey is ``trying to work this problem diplomatically.''

No Handover

Iraqi President Jalal Talabani denied today that he had offered to hand over PKK leaders to Turkey. Those figures are hiding in the mountains with their fighters, and it is ``impossible to arrest them and deliver them to Turkey,'' according to a statement his office issued, Agence France-Presse reported.

Turkey, with the second-largest army in the North Atlantic Treaty Organization, sent troops into northern Iraq in pursuit of PKK rebels several times in the decade before the U.S.-led war to oust Saddam Hussein in 2003. It has stopped such assaults since the U.S.-led invasion, instead attacking PKK units as they have entered Turkey.

The National Security Council, a forum of Turkish ministers and army generals, met in Ankara today to discuss measures against the armed group.

The president of Iraq's northern Kurdish region, Massoud Barzani, urged the PKK to end its more than two-decade armed struggle against Turkey. Barzani said his administration didn't accept the use of Iraqi territory, including Iraqi Kurdistan, as a base to threaten the security of neighbors, an e-mailed statement by Barzani's office said.

A team of Iraqi officials will visit Ankara for meetings on the PKK with Turkey's government, Secretary of State Condoleezza Rice told a congressional hearing today. Turkish Foreign Minister Ali Babacan held talks with Iraqi counterpart Hoshyar Zebari in Baghdad yesterday.

``We have a list of things that we really believe, if they are undertaken, will help to deal with the situation,'' Rice said.

To contact the reporter on this story: Mark Bentley in Ankara, Turkey on at mbentley3@bloomberg.net; Roger Runningen in Washington at rrunningen@bloomberg.net

Last Updated: October 24, 2007 13:29 EDT