The head of the Central Intelligence Agency, George Tenet, told U.S. lawmakers Tuesday that Iraq has had contacts with the al-Qaida terrorist network.

Although some in the U.S. intelligence community have dismissed reported links between Iraq and al-Qaida because of their opposing ideologies, Mr. Tenet offered another view at a Senate Armed Services Committee hearing Tuesday.

"Their ties may be limited by divergent ideologies, but the two sides' mutual antipathy toward the United States and the Saudi royal family suggest the tactical cooperation between them is possible," Mr. Tenet said.

President Bush has labeled Iraq part of an 'axis of evil', along with North Korea and Iran. His recent focus on Iraq has prompted speculation that it may be the next target in the U.S. led war on terrorism.