Violence is masking a deepening humanitarian crisis in Iraq, with hunger and disease spreading, Oxfam has warned in a report.

The charity said 28 per cent of Iraqi children are malnourished, 15 per cent of Iraqis regularly cannot afford enough to eat and 70 per cent lack clean drinking water, all sharp increases since 2003 when Oxfam carried out its last report.

Two million Iraqis have been forced to flee the country - or 2,000 a day - since 2003, and at least that number have been displaced within Iraq.

Oxfam director Jeremy Hobbs said: "The terrible violence in Iraq has masked the ongoing humanitarian crisis.

"Malnutrition amongst children has dramatically increased and basic services, ruined by years of war and sanctions, cannot meet the needs of the Iraqi people."

"The fighting and weak Iraqi institutions mean there are severe limits on what humanitarian work can be carried out. Nevertheless more can and should be done to help the Iraqi people."

Oxfam, which pulled out of Iraq along with most other aid agencies because of deteriorating security in 2003, said there are local charities within Iraq that are working to help the poorest Iraqis. But most are under-funded.

Some are afraid to accept aid from countries with troops in Iraq for security reasons and Oxfam called on countries that have not sent troops to send more money for aid.