After the deadliest month yet for U.S. troops in Iraq (search), top Bush administration officials fear the situation will deteriorate in coming weeks as insurgents try to create turmoil amid the June 30 handover of power to Iraqis.

Speaking on condition of anonymity, White House officials said Monday they see reason to be hopeful that the situation will eventually improve. But they can't say when the turning point will come.

From President Bush down, the administration now acknowledges that the U.S.-led occupation bred more frustration among Iraqis than the White House had initially expected.

"We're implementing a clear strategy in Iraq. First we will ensure there's an atmosphere of security as Iraqis move toward self-government, Bush told supporters at a campaign rally Monday night in Sterling Heights, Mich., just outside Detroit.

"We support the effort of local Iraqis to convince the radicals to disarm. ... America and coalition forces are in place and we are fully prepared to bring security and order in Fallujah (search) and Najaf and around the country of Iraq."

A senior administration official said Monday afternoon that there were developments that could lead to an improvement: The Americans on the ground know more about how to work with local leaders; Iraqis will soon have a measure of political power; they already have defense and interior ministers.

But the official said it is likely that in the next few weeks, those who oppose the American presence will intensify their attacks. In April, 136 American soldiers died in Iraq, and ten times as many Iraqis — on both counts, the most since Saddam's fall.

Pictures of Americans abusing Iraqi prisoners are damaging to the U.S. cause, the official said.

The administration is hoping that positive images of U.S. soldiers building schools and medical clinics will help counter those photos. The U.S.-funded Arabic Al-Hurra (search), Al-Iraqiya (search) and the Middle East broadcast network are prime outlets for airing such flattering images, the official said.

The senior official would not rule out the possibility of a request by the administration for more money to finance military operations in Iraq.

Another senior administration official said it is likely that lawmakers will approve money on a contingency basis that could go to the Pentagon for Iraq should it run out of money while Congress is adjourned at the end of this year.

Bush has not been told by military commanders there is a shortfall, both officials said.