By Annika McGinnis
WASHINGTON, July 2 (Reuters) - U.S. President Barack Obama discussed Iraq and the violent rise of a Sunni insurgent group there in a telephone call on Wednesday with Saudi Arabian King Abdullah, the White House said.
Obama thanked the Saudi king for his $500 million pledge to help Iraqis displaced by an upsurge in violence as militants from the Islamic State of Iraq and the Levant seized provinces in the north and west of Iraq, it said in a statement.
Abdullah, leader of the world's top oil exporter, vowed last week to act against potential "terrorist threats" that have torn Iraq apart in recent weeks.
Three days after ISIL declared itself a caliphate encompassing the entire Muslim world, Obama and Abdullah agreed to consult closely on regional developments, the White House said. Saudi Arabia shares an 500-mile (800-km) border with Iraq.
Iraq has split along sectarian lines between the majority Shi'ite Muslims and the Sunni Muslim and Kurdish minorities. Obama and Abdullah discussed the need for Iraq to form an inclusive new government "uniting all of Iraq's diverse communities," the White House said.
Sunnis and Kurds on Tuesday walked out of the first meeting of Iraq's new parliament, which failed to name a new prime minister as an alternative to current leader Nuri al-Maliki.
Baghdad has blamed the Saudis for encouraging "genocide" in Iraq. But though Saudi Arabia gives money and supplies to Sunni rebels in Syria, it denies backing the militants in Iraq.
The country's $500 million donation will go through the United Nations to counter Iraq's humanitarian crisis. (Reporting By Annika McGinnis; Editing by Doina Chiacu)