"They are out of danger as was declared yesterday by Sheikh Hareth al-Dhari, their release could just be a matter of time," said Sheikh Abdel Salam al-Kubeisi, an influential cleric on the Committee of Muslim Scholars.

Kubeisi's organisation has privileged contacts with the Sunni militant groups operating in Iraq.

One expert on the militants said the two Frenchmen were being held in the Sunni insurgent stronghold of Fallujah, west of Baghdad, and suggested that recent US strikes on the town risked complicating the negotiations.

Another source with close links to the insurgency told AFP on condition of anonymity that journalists Georges Malbrunot and Christian Chesnot were still in the hands of the Islamic Army in Iraq and being detained in the Baghdad region.

But French diplomatic sources in Baghdad said Friday afternoon they had no fresh information on the whereabouts of the two reporters and expressed irritation at the "completely groundless" speculation on their fates of recent days.

The pair abducted August 20 on the perilous road between Baghdad and Najaf are "alive, in good health and being well treated" but still captive, one diplomat said, on condition of anonymity.

"There is hope and a great chance of a happy outcome. When will this happen? No one can tell. Maybe today, tomorrow or the day after that, but the situation in Iraq is such that it could not take much to scupper the whole process."

The Islamic Army in Iraq follows the strict Wahabist school of Islam and has already claimed responsibility for several abductions and executions in Iraq, including the killing of Italian reporter Enzo Baldoni last week.

The militant group thought to be based mainly in Fallujah has demanded Paris lift a controversial ban on headscarves in state schools to secure the release of the hostages.

But the law came into effect regardless on Thursday as the French school year began. The ultimatum from the captors was the first time kidnappers here had made demands external to Iraq.

However the targeting of a country which vigorously opposed last year's US-led invasion apparently backfired as France managed to muster broad international support for its efforts to free the journalists and united the vast majority of Muslim institutions behind its cause.

Messages of support continued to flow in Friday, with Shiite radical leader Moqtada Sadr calling for the reporters' release in recognition of France's anti-war stance through a sermon read by one of his aides.

Another member of Sadr's organisation accused America of masterminding the kidnappings during a vitriolic sermon in Baghdad.