UPDATE 4-Iraq police fire in air as protesters try to storm Basra govt building

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* Seventh day of unrest

Demonstrations about poor government services

* Prime minister pledges support (Updates casualties, adds new quotes)

By Aref Mohammed

BASRA, Iraq, July 15 (Reuters) - Iraqi police fired in the air to disperse hundreds of protesters who tried to storm a government building in Basra and demonstrated near an oil field, police said, wounding 48 people in unrest over poor services that has swept southern cities.

"Some protesters tried to break into the building, but we prevented them. We ask protesters to avoid facing off with security forces," said Major General Thamir al-Hussaini, commander of the Interior Ministry's Rapid Response Forces.

He said a total of 28 members of the security forces were wounded in clashes with demonstrators.

A week of protests has put Iraqi Prime Minister Haider al-Abadi in a difficult position. He hopes to serve a second term when politicians form a new government following a May 12 parliamentary election tainted by allegations of fraud.

Protesters lambasted his Dawa Party, which has dominated Iraqi politics since a 2003 U.S.-led invasion toppled Saddam Hussein.

"The Dawa party has been running Iraq for 15 years and its leaders failed to live up to even a single promise they made," said Ziad Fadhil, 38, who is unemployed. He held up a piece of cardboard to shield his head from the scorching sun.

Eight protesters were wounded at the provincial government building in the oil hub city of Basra in the south, police said.

Security forces also faced demonstrations about four kilometers from Eni's Zubair oil field near Basra. Forty protesters were wounded, three by live fire, according to police sources.

Iraq's top Shi'ite cleric, Grand Ayatollah Ali al-Sistani, has expressed solidarity with protesters, saying they faced an "extreme lack of public services".

Sistani, who has millions of followers, rarely intervenes in politics, but has wide sway over public opinion.

Internet access in Iraq has been dramatically reduced.

Local officials said demonstrations have not affected crude production in Basra, whose shipments account for more than 95 percent of OPEC producer Iraq's state revenues.

Any disruption could severely impact the country's limping economy and push up global oil prices.

STRUGGLE TO REBUILD

On Friday, protesters stormed the international airport in the holy city of Najaf, temporarily suspending air traffic.

Jordan's state airline said on Sunday it had suspended four weekly flights to the Iraqi city of Najaf due to the "security situation at its airport, a company statement said. Flyudubai also followed suit.

Flights from Iran to the Iraqi city of Najaf will be diverted to Baghdad, Iran's state television reported on Sunday.

Abadi has announced that his caretaker government would release funds to Basra for water, electricity and health services.

A political bloc led by populist cleric Moqtada al-Sadr won a majority in the poll on an anti-corruption platform which had appeal across Iraq's electorate.

Substantial relief is unlikely to come anytime soon for Basra, once dubbed the "Venice of the Middle East" for its network of canals resembling the Italian city.

Iraq needs to generate billions of dollars to rebuild after its three-year war with Islamic State.

Demonstrators, who are demanding jobs and better government services, have cut off access to the southern Umm Qasr commodities port.

Security forces have battled protesters in Basra and several other cities in the south.

Saddam Hussein oppressed the country's majority Shi'ites, neglecting their southern heartland.

Successive Shi'ite-led governments that have run the country since he was toppled in 2003 have also done little to improve lives in Basra and others cities in the region, where oil money rarely trickles down to the population.

"Since the fall of Saddam in 2003 and until now the only real thing Shi'ite politicians have been saying is their lies," said Usama Abbas, 25, an unemployed college graduate.

"We still drink filthy water and forgot what air conditioning means during summer."

The demonstrators have taken the unusual step of attacking buildings belonging to powerful Shi'ite militias, in addition to local government headquarters.

Abadi, who also serves as commander-in-chief of Iraq's armed forces, had earlier issued a nationwide order placing security forces on high alert in the southern provinces.

His directive aims to stem the burgeoning protests, which spread from Basra to the cities of Amara, Nasiriya and the Shi'ite holy city of Najaf. (Reporting by Aref Mohammed in Basra and additional reporting by Suleiman al-Khalidi in Amman; Writing by Michael Georgy; Editing by Keith Weir)