Annan, the chief mediator who looked frustrated on the direction the talks were heading put them on hold to allow for direct talks with president Kibaki and ODM leader Raila Odinga. "Despite starting well on the initial stages, we are now moving round in circles over the issue of governance," Annan said.

Cracks in the talks emerged on Friday, the day a significant breakthrough was expected. The government PNU party made new demands that were different from the ones that were on the table.

The PNU reversed on its part by saying only the president should elect ministers, the Prime minister would only be coordinating government duties and that the president can sack the PM.

This was different from what had earlier been on the table that the ODM will elect and share ministries 50:50, the president should not sack the PM and were at that moment negotiating on how much clout the PM would have

Talks came to a head when both groups took a hardline stance and no one budged from their positions in a meeting a PNU spokesman, Mutula Kilonzo said "tempers flared".

US secretary of State Condoleeza Rice immediately sent a statement where she voiced her disappointment at the turn of events. "While some progress had been made, I am disappointed by the failure of leadership necessary to resolve the remaining issues."

Ms Rice said they would with the European Union, the United Nations and the African Union exert pressure to ensure a political solution was agreed. She further threatened they will make their own conclusions on who was stalling the talks and take "necessary steps". The government has insisted they are still committed to the talks.

Tension has started brewing as groups from both sides are said to be arming themselves ready for conflict as the talks show little signs of progress.

More than 200 militias were arrested by police Monday as they trained in a farm belonging to a former member of parliament. They have been training for more than a month and were planning to attack a community in the neighboring Trans Nzoia district.

More than 1,000 people have died and over 300,000 have been displaced since the political crisis that was triggered by the disputed December 27 elections that local and international observers said were rigged in favor of the ruling PNU party.

European commissioner Louis Michel in an emailed statement said he was "strongly concerned" that the power sharing agreement has not yet been delivered to the Kenyan people. "There is no alternative to a political solution of this kind," he said.