More than 125 people were killed on Thursday, including 11 US servicemen.
The visit by a key US ally came as Al Qaeda's number two Ayman al-Zawahiri issued a video calling on President George W. Bush to "admit defeat" in Iraq, saying US troop withdrawals would be a "victory" for Islam.
"Bush, you must admit that you have been defeated in Iraq and that you are being defeated in Afghanistan and that you will soon be defeated in Palestine, with the help and strength of God," said Zawahiri, sitting with an assault rifle at his side, in a tape broadcast by Al Jazeera.
Mr Straw made an unannounced trip to the southern city of Basra, where British troops are based.
Mr Straw, who had been in Beirut on a Middle East tour, wanted to assess the situation on the ground after the December 15 parliamentary elections, which remain dogged by complaints of fraud.
"It's an opportunity for him to meet local politicians," a Foreign Office spokesman told AFP in London.
"In Basra, he's meeting the governor, members of the city's ruling council and other politicians to discuss those issues and obviously he'll be getting an update on the security situation."
Continuing violence
Highlighting the ongoing violence, one police commando was killed and three injured in a suicide car bomb attack against a police checkpoint in the southern Baghdad neighbourhood of Zafaraniya, the interior ministry said.
Police were also targeted in another suicide car bombing in the northern city of Mosul. The bomber blew up his vehicle next to a police patrol, wounding 11 people including four policemen, police said.
Some 10 unidentified bodies, all shot dead, were also discovered in the Iraqi capital.
Politicians condemned the recent escalation in unrest as a bid to raise sectarian tensions and impede the creation of a unity government.
Weak army parade
Anxious to demonstrate progress on the security front, hundreds of Iraqi troops paraded in front of senior Iraqi and US officials inside Baghdad's fortified Green Zone to celebrate Iraq's army day.
But the ceremony, marking the 85th anniversary of the military's creation, was a fraction of its previous size under Saddam.
The toppled dictator used to sit with a rifle on his lap, firing off rounds, as thousands of troops, tanks, helicopters and fighter jets took part in a three to four hour-long parade.
This time, there were only two old Russian tanks on display as well as some US-made Humvees and military trucks, while Iraq's current president and prime minister both chose to stay away.