A spokesman for Annan on Friday said the secretary general was "particularly troubled by the high death toll including civilian casualties".
"He believes that, in such a situation, force should be [a] last resort. He calls for every effort to be made, even at this late hour, to work out a ceasefire and peaceful solution," the spokesman said.
"The United Nations is ready to extend its facilitating role to the current crisis, if this would be helpful," he added.
The spokesman also welcomed Iraqi interim Prime Minister Iyad Allawi's offer of limited amnesty.
"The Prime Minister's offer today of a limited amnesty and wider participation in the political process are steps in the right direction," he said.
Allawi has offered month-long amnesty to those who are caught in possession of light weapons and explosive materials and those who concealed information about resistance fighters or might have sheltered or financed them.