The top U.S. military commander in Iraq says he believes the U.S. can return to what is known as a pre-surge level of troops by the middle of next year.
General David Petraeus is testifying before members of the House of Representatives on the impact of an eight-month U.S. troop build-up in Iraq ordered by President Bush.
The withdrawal of the extra 30-thousand troops of the surge would mean about 130-thousand troops would remain.
The general accused Iran of seeking to fight a "proxy war" with the Iraqi state and coalition forces by supporting Shi'ite militants in Iraq.
Iran has denied such charges in the past. Petraeus said the military objectives of the surge are largely being met.
Testifying about political conditions in Iraq, U.S. Ambassador to Iraq Ryan Crocker said gains at the national level are taking longer than expected.
The ambassador says there has been more progress on the provincial level. He adds that the Iraqi economy is performing significantly under its potential.
Crocker added that, overall, the decision to increase troops has helped change the dynamics in Iraq for the better.
He said he cannot guarantee success in Iraq, but believes it is attainable and asks the American people for more time and patience.
General Petraeus said there has been an overall decline in Iraqi civilian deaths, but said they remain at troubling levels.
The general said he is encouraged that the rejection of al-Qaida in Iraq by tribal leaders in Anbar province is spreading to other areas.
In an opening statement, Democratic Congressman and chairman of the House Armed Services Committee Ike Skelton said Iraqi politicians have failed to even start the process of reconciliation, a key reason for providing the surge in troops.
The proceedings were interrupted at various times by anti-war protesters, who were removed from the room and arrested.
This testimony to a joint hearing of the House Armed Services and Foreign Affairs Committees will be followed Tuesday with testimony to a Senate panel.
It comes as Congress debates when and how U.S. troops should leave Iraq.