WASHINGTON - The White House on Tuesday denied a report that the Obama administration has decided to slash the number of US troops in Iraq to 3,000 at the end of the year.

Quoting "multiple sources familiar with the inner workings and decisions on US troop movements in Iraq," Fox News reported Tuesday that the number of US troops in Iraq will be reduced to 3,000 at the end of the year, a proposal that has been approved by Defense Secretary Leon Panetta.

Press Secretary Jay Carney responded with a flat "no" when the accuracy of the report was questioned at the White House's daily press briefing.

The administration is "in negotiations, consultations with the Iraqi government about what our relationship with Iraq will look like going forward," Carney said.

"We want a normal, productive, healthy relationship with Iraq," he said. "If the Iraqi government makes a request of us, we will certainly consider it."

More than 40,000 US service members are now stationed in Iraq, and they are to pull out completely by the end of 2011, according to a security agreement signed in 2008 between Baghdad and Washington.