By Khaled Yacoub Oweis

DAMASCUS, July 23 (Reuters) - A large meeting of Iraqi rebel groups that was due to be held in Damascus on Monday was cancelled at the behest of Syria, delegates said.

Hundreds of delegates, including members of the banned Iraqi Baath Party, officers in Saddam Hussein's now defunct security forces and anti-U.S. tribal leaders, had gathered in Damascus to work out a joint programme for groups opposed to the continued presence of U.S. forces in Iraq.

"The Syrians gently made it clear that this is not the time for this," a senior Baath Party member told Reuters.

"The Americans and their Iraqi government clients are intensifying their lies that Syria is behind terrorism and attacks on innocent Iraqis, which we all condemn."

He was speaking at a meeting to announce the cancellation of the conference at a hotel in the outskirts of Damascus. The decision did not go down well with most participants, especially those who had travelled from Iraq.

Some delegates linked the meeting's cancellation to the visit last week to Syria by Iran's President Mahmoud Ahmadinejad.

A communique issued after a meeting between Ahmadinejad and President Bashar al-Assad last week said the two leaders were adamant about the need to end U.S. occupation but back the Iraqi government and "condemn terrorism against the Iraqi people and their institutions".

Envoys from Shi'ite Muslim Iran and arch foe the United States are due to hold a second round of talks on Iraqi security in Baghdad on Tuesday.

Syria's secular government, which has been reinforcing links with Iran, took steps last year to improve ties with Iraq.

Iraqi Vice President Adel Abdul Mahdi is expected to visit Damascus next month.

INFLUENCE

With a 360-km (225-mile) border with Iraq and some 1.4 million Iraqi refugees in Syria, Damascus has said that a descent into an all out civil war there would have "devastating consequences" for the region.

Thousands of Iraqi Baathists and former security figures have made Syria their base since the 2003 U.S. invasion.

The Iraqi government says they play a major role in supporting the insurgency. Washington accuses Syria of letting fighters cross its borders into Iraq, a charge Syria denies.

Damascus says its influence with rebel forces in Iraq could help the United States achieve an "honourable withdrawal" for American troops.

"We should not see a contradiction between raising the gun and negotiating an end to the occupation," a tribal leader from Iraq's western Anbar province addressed the delegates.

He acknowledged, however, that the rebel groups lack a unified political front.

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