Iraq has to be partitioned into three independent countries in a manner similar to India in the 40's.  It's not a perfect solution but it's about the only one that has a chance of creating some stability.
Right except for the Kurds in the North who would have no oil money and still living in the hillsides.
Much of the Iraqi oil lies in the North and the South - so the Kurds would be OK - apart from they are left with the daunting problem of exporting oil either N through Turkey - who are kind of hostile to the overall concept of Kurdistan - or South through what is currently Iraq.  I'm not sure that the Sunnis actaully get left with anything - which may be one of their current concerns.
Turkey worries that an independent Kurdish state on their border would attempt to incite separatist Kurds inside Turkey. That's a bit of a political hot potato there.
I don't think Iran would like to see an Independent Kurdistan either.

http://en.wikipedia.org/wiki/Kurdish_people#Kurds_in_Iran

GreyZone,

And the Iranians with their sizeable minority. But the Kurds did secure some oil for themselves.

Tate,

  The Kurds have place themselves with opportunity to take Kirkuk and it's oil fields.  The Sunni's feel like the ones left out in the cold (no oil) in the west.  But if they got their act together and listened to the posters here, they would probably be on the largest amount of "undiscovered" oil in the ME out there.  That is of course if it did not follow the pattern of the Empty Quarter.

In a partition of Iraq, the Kurds would probably take the town of Kirkuk and its oilfields. The Shiites would get the southern fields around Basra, and the Sunnis the northern fields around Mosul. I agree that Turkey would probably not let the Kurds export oil through their territory, so it would most likely pass to the south through Shia territory.

If Turkey came down hard on the Iraqi Kurds, they likely lose any chance to join the EU, although I am not sure how big a disincentive that would be for the Turks.

Well, then, if we're going to go to all that effort, let's also adjust the U.S./Mexico and U.S. Canadian borders, too. CA goes back to MX, and "54-40 or fight," wasn't that the chant?

;o)