The ambush-style attack showed suspected Sunni insurgents again taking aim at the millions of worshippers who traveled to the holy city of Karbala and are now heading home.

It also displayed the limitations of the U.S.-led crackdown seeking to restore order in the capital, where bombers still strike with deadly efficiency against mostly Shiite targets in an apparent bid to ignite an full-scale civil war.

Blasts killed at least 15 others in Baghdad a day after Iraqi officials warned an international conference that Iraq's sectarian violence could spread across the Middle East if not quelled.

Outside the capital, Sunni extremists attacked Shiites and set about 30 houses on fire in villages around Muqdadiyah, 60 miles northeast of Baghdad, forcing dozens of families to flee, local officials and witnesses said.

The latest attacks followed a week in which hundreds of Shiite pilgrims were killed trying to reach the rituals in Karbala, about 50 miles south of Baghdad. The exodus faces the same risks.

The pilgrims riding back in the truck - about 70 men and boys-passed through the most dangerous stretch of Sunni-dominated territory. They were celebrating their good fortune as they moved into heavy traffic at a place known as Embassy Intersection because the German diplomatic compound occupies one corner.

One of the pilgrims, Mustafa Moussawi, noticed a car racing far too fast coming toward them from behind.

"Then the car bomber slammed us," said Moussawi, a 31-year-old vegetable store owner who suffered slight injuries when he was thrown to the street by the force of the blast.

He was among the luckiest. Most others were swallowed by instant flames. Another survivor, Nasir Sultan, a 38-year-old Transportation Ministry worker, said he watched people thrash helplessly in the inferno.

Police and hospital officials said at least 32 people died and 24 were injured.

"I blame the government," said Moussawi. "They didn't provide a safe route for us even though they knew we were targets for attack."

In the past two years, the Shiite militia Mahdi Army provided security for the pilgrimage -marking the end of 40 days mourning for the 7th century battlefield death of the Prophet Muhammad's grandson. Shiites consider him the rightful heir of Islam's leadership, which help cement the rift with Sunni Muslims.

This year, however, the Mahdi militiamen has been sent to the wings under a deal between its leader, radical cleric Muqtada al-Sadr, and the government to ease the way for the Baghdad security sweeps.

The pact has apparently led to a decrease in execution-style slayings blamed on Shiite death squads. It also made the pilgrims easier prey.

Shortly before the truck was attacked, a bomb-rigged car in central Baghdad killed at least five pilgrims and injured six. In another part of the city, a suicide bomber detonated a belt packed with metal fragments inside a minibus heading to a mostly Shiite area, killing at least 10 people and wounding five.

Brig. Gen. Dana Pittard, who commands U.S. units training Iraqi forces, said nearly 80 percent of Iraqi military divisions are under full local control, but getting the forces fully outfitted with "logistical support" -such as communications and state-of-the art equipment - "is going to take much more time."

He also encouraged Iraqi government efforts to bring back some former military and security personnel from Saddam Hussein's regime - who were part of wholesale dismissals to clear away members of his Baath party.

"It's what a person's talents and experience can bring to the situation," said Pittard, who noted complaints that the past Baath purges "went way, way too far."

On Saturday, Iraq's prime minister, Nouri al-Maliki, opened a conference of neighboring nations and world powers with a warning that Iraq's sectarian strife could spread across the region.

The one-day meeting was highlighted by rare direct exchanges between Iran and the United States - which reportedly grew testy in the closed-door session with other envoys.

Iran pressed for a timetable for a withdrawal of U.S.-led forces from Iraq, and the U.S. delegation reasserted claims that Shiite militia receive weapons and aid from Iranian sources.

But the gathering also ended with both sides leaving open the possibility of further contacts to discuss Iraq - where they share interests as Baghdad's top allies. The U.S. and Iranian statements were carefully framed in cautious diplomatic language, but they were seen by some possibly significant steps toward easing their nearly 28-year-old diplomatic freeze.

Iraq's foreign minister, Hoshyar Zebari, called the conference "an icebreaking attempt to provide an atmosphere for some discussions."

Zebari also repeated the fears that Iraq could be the breeding ground for a wider Mideast meltdown.

"No country will be immune from Iraq's failure and the consequences that they will suffer," he told CNN.

A senior member of Iraq's biggest Shiite political bloc - which maintains very close ties to Iran - applauded the interaction between Iran and the United States.

"We hope that this conference would represent a good start to establish a kind of understanding between American and Iran regarding the accusations and counteraccusations about Iraq," said Humman Hamoudi, who heads the group's external affairs committee.

But, say some analysts, any changes in relations will be likely a slow evolution.

"The superpower is like a trolley bus and not like a car. A car can turn around on a narrow road," said Imad Fawzi Shueibi, Damascus-based political researcher. "The trolley has to make a wide, slow turn. This is what you are seeing now. The superpower trolley beginning to turn in Iraq."

Meanwhile, the U.S. military reported three soldiers killed Sunday. One was killed by a roadside bomb southwest of the capital, while another died in combat and the third was killed in an unspecified "non-combat incident" in northern Iraq, the military said.

In the Salahuddin province northwest of Baghdad, Iraqi-led forces backed by U.S. warplanes staged raids against suspected insurgent training bases, including sites linked to anti-aircraft batteries, the U.S. military said. At least seven suspected insurgents were reported killed.

In the northern city of Mosul, a suicide bomber attacked the offices of the largest Sunni political group, said Mohammed Shakir al-Ghanam, a member of the Iraqi Islamic Party. Three guards were killed and two wounded, he said.

The reason for the attack was not immediately clear. The party is the only Sunni political movement with a national base.

Mosul, about 225 miles northwest of Baghdad, also has witnessed a rise in suspected Sunni insurgent attacks. Iraqi troops detained 12 suspected militants in the Mosul area in raids since Saturday, said an Iraqi commander, Brig. Gen. Mutaa al-Khazraji.