A secret deal being negotiated in Baghdad would perpetuate the American military occupation of Iraq indefinitely, regardless of the outcome of the US presidential election in November, British newspaper The Independent revealed Thursday.

According to the report, the deal, details of which have been leaked to The Independent, is likely to have an explosive political effect in Iraq.

Iraqi officials fear that the accord, under which US troops would occupy permanent bases, conduct military operations, arrest Iraqis and enjoy immunity from Iraqi law, will destabilize Iraq's position in the Middle East and lay the basis for unending conflict in their country.

Under the terms of the treaty, the US would retain the long-term use of more than 50 bases in Iraq. American negotiators are also demanding immunity from Iraqi law for US troops and contractors, and a free hand to carry out arrests and conduct military activities in Iraq without consulting the Baghdad government.

The precise nature of the American demands has been kept secret until now, and the leaks are certain to generate an angry backlash in Iraq, said the report.

"It is a terrible breach of our sovereignty," said one Iraqi politician, adding that if the security deal was signed it would delegitimize the government in Baghdad which will be seen as an American pawn.

The US has repeatedly denied that it wants permanent bases in Iraq, but one Iraqi source said, "this is just a tactical subterfuge."