Iraq deployed troops Saturday to monitor an oil well seized by Iranian forces along the disputed border between the two countries, an Iraqi official said, as Baghdad demanded once again that Iran withdraw.

The diplomatic standoff began late Thursday, when Iranian forces reportedly crossed into Iraq and seized the well, which sits just over the border in the southern Maysan province. It was a dramatic display of the occasionally tense relations between the wary neighbors.

Iraqi troops and border guards were in the area at a staging ground about a half mile (a kilometer) from oil well No. 4 at the al-Fakkah oil field and were awaiting further orders, said an Interior Ministry official at the site who was not authorized to talk to reporters. It was unclear how many troops were involved. Iraqi forces barred journalists from approaching the area.

The field is located about 200 miles southeast of Baghdad.

The takeover — which included the planting of an Iranian flag on the well — was met by protests from Baghdad and an emergency meeting of Iraq's national security council that denounced it as a gross violation of Iraqi sovereignty.

Iraqi officials said the well was clearly in Iraqi territory and demanded the Iranians leave immediately. High-level diplomatic talks between Iraq and Iran are continuing, said Iraqi deputy foreign minister Labid Abbawi.

"The situation this morning is the same: The Iranians have not withdrawn from the well," Abbawi told The Associated Press. "We are still sticking to our position in demanding an immediate withdrawal of Iranian forces from the oil well."

It was not clear whether the Iranian forces who reportedly seized the well late Thursday night were still there, and Iran gave conflicting signals Saturday about the incident.

The Iranian military, in a statement carried by the Arabic language Iranian news station al-Alam, denied they had violated Iraq's sovereignty and said the oil well was part of Iranian territory under a 1975 border agreement.

Iranian Foreign Ministry spokesman Rahmin Mehmanparast accused foreign media of spreading false news to "disrupt good relations" between Tehran and Baghdad.

"Diplomatic and technical mechanisms" were the way to deal with the issue, said Hasan Kazemi Qomi, the ambassador to Iraq, according to the semiofficial Fars news agency.

Christopher Hill, the U.S. ambassador to Iraq, said the incident does speak to the overall view in the country that the Iraqis are not going to be "pushed around by Iran."

Army Gen. Ray Odierno, commander of U.S. forces in Iraq, told reporters that the Iranian forces had withdrawn from the oil well as of Saturday morning. But an oil worker at the field said five Iranians remain at the well and the Iranian flag still flew above it.

The worker, who did not want to be identified for fear of retribution, said Iranian troops were watching the well from a hillside on Iran's side of the border.

It was not clear as well what kind of Iranian forces had been at the well. An Iraqi official and a witness described them as soldiers, while the Iraqi government spokesman earlier described them only as armed men.

U.S. officials said Iran had overstepped its boundaries.

Adm. Mike Mullen, the top American military official, said the U.S. considers the oil site Iraqi sovereign territory.

However, Mullen said the incident must be resolved by the Iraqi government, and there were no plans by the United States to intervene.

Once bitter enemies, Iraq and Iran settled into a more positive, if still uneasy, relationship after a Shiite-led government came to power following the 2003 U.S.-led invasion.

"I continue to worry about the influence of Iran," Mullen, in Iraq for a two-day visit with U.S. and Iraqi authorities, said at a news conference in Baghdad. "I still think it's important that Iran have a constructive, positive influence in this region and globally. And there are just too many examples where that is not the case."

Odierno also said Iran continues to fund and train fighters in Iraq, as well as send weapons and equipment over the border — although less frequently now than in the past.

Analysts said it was too early to say whether the incident would mushroom into greater tension but said it could raise concerns with oil companies looking to invest in Iraq.

Oil prices rose slightly Friday after news of the incident.