Sunni fighters, among them the jihadists of Isis, have been fighting across northern Iraq
Iraq's government is struggling in its battle against militants, diplomats and politicians have told the BBC.
Fighters from the Islamic State in Iraq and the Levant (Isis) said they seized a border crossing to Syria and two towns in north-west Iraq on Saturday.
Correspondents say Isis appears to be better trained, better equipped and more experienced than the army.
The Sunni extremists attacked the city of Mosul in June and have since seized large swathes of territory across Iraq.
There is deep pessimism in Baghdad about the way the government's war against Isis is going, says the BBC's World Affairs Editor John Simpson, who has been speaking to senior politicians and diplomats in the capital.
The Iraqi air force ran out of American Hellfire missiles two weeks ago, and in any case only has two Cessna planes capable of firing Hellfires, he adds.
Experts say Isis has established secure safe havens, including some in neighbouring Syria, which will be difficult to target.
Sectarian tensions
On Saturday, Iraqi officials admitted that Isis had seized a border crossing near the town of Qaim, killing 30 troops after a day-long battle.
Rebels also said they had taken the towns of Rawa and Aneh along the Euphrates river.
Correspondents say a campaign along the river may eventually lead to an assault on Baghdad from the west.
The capture of the Qaim crossing in western Iraq could also help Isis transport weapons and other equipment to different battlefields, analysts say.
Shia cleric Moqtada al-Sadr has rallied followers to join a military parade across Iraq, as Jonathan Beale reports from Baghdad
Extremist fighters claim to have seized parts of Iraq's largest oil refinery, at Baiji, and have also taken a disused chemical weapons factory in Muthanna, 70km (45 miles) north-west of Baghdad.
The government denied that militants had gained access to parts of the Baiji refinery but said the army was facing "violent attacks" from gunmen.
Also on Saturday, thousands of Shia militia loyal to the powerful cleric Moqtada al-Sadr paraded through the streets of Baghdad.
The cleric, whose Mehdi Army fought the US in Iraq for years, had called for a military parade across the country.
Correspondents say the show of force will be seen as a very disturbing development by the Baghdad government as the parade will only raise sectarian tensions at a time when the government is under pressure to rally the country together against the extremists.
US Secretary of State John Kerry is expected to travel to Iraq soon to press for a more representative cabinet, hoping this could ease tensions between the country's rival Muslim sects.
The US, which pulled out of Iraq in 2011, is sending some 300 military advisers to Iraq to help in the fight against the insurgents there.
But in the face of Iraqi calls for US air strikes, the White House is insisting that there is no purely military solution to the crisis.
Correspondents say Mr Obama believes Iraqi PM Nouri Maliki has endangered the country by ignoring Sunni concerns and governing in the interests of the Shia majority.
Iraq's sectarian split
- Sunnis and Shia share fundamental beliefs, but differ in doctrine, ritual, law, theology and religious organisation
- The origins of the split lie in a dispute over who should have succeeded the Prophet Muhammad as leader of the Muslim community
- Sunnis are the majority sect in the Muslim world, but Shia, most of them ethnic Arabs, form between 60% and 65% of Iraq's population; Sunnis make up 32-37%, split between Arabs and Kurds
- Sunni Arabs dominated Iraq under Saddam Hussein and their persecution of the Shia stoked sectarian tensions; the US-led invasion in 2003 gave the Shia an opportunity to seek redress
- Nouri Maliki has been accused of denying Sunni Arabs meaningful representation and pursuing security policies that target them
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