The UK would "consider favourably" any request for arms from the Kurds in their battle with extremists in Iraq, the foreign secretary has confirmed.
Philip Hammond described militant group Islamic State (IS), which is fighting the Kurds and has seized large parts of northern Iraq, as a "terrible threat".
Downing Street said no request for UK arms had been received from Kurdish forces.
The issue was discussed at a meeting of EU foreign ministers in Brussels.
Downing Street said the UK was providing other countries with logistical support to transport supplies to Kurdish forces.
Mr Hammond said a UN Security Council resolution would freeze the assets of IS, and "take steps" against its "financiers and facilitators".
France and the US have already supplied arms to the Iraqi Kurds.
Meanwhile, Iraqi Prime Minister Nouri Maliki has resigned and conceded power to Haider al-Abadi, Iraq's deputy speaker.
Mr Hammond said: "The UK has said we will also consider favourably any requests for supplies of arms. We are already shipping ammunition and supplies from other eastern European countries into Irbil."
He said the meeting was a chance to send "a very clear signal that Iraq now needs to have an inclusive government representing all the people of Iraq so that we can get behind it and push back this terrible threat from IS".
The Iraq crisis was also the subject of a meeting of the government's emergency Cobra committee, chaired by Defence Secretary Michael Fallon.
Elsewhere, Downing Street said two planeloads of UK aid were on their way to Erbil, heading for the Dahuk refugee camp. Their cargo includes "essential items such as cooking equipment" which will be distributed by the World Food Programme.
Its statement added: "Latest figures suggest that there are now 450,000 displaced people in the Dahuk governorate, which represents a 50% increase in the area's population.
"A Department for International Development humanitarian adviser is still assessing the area and has now visited the city and nearby refugee camps. In the coming days our efforts will focus on strengthening capacity in the local area to cope with this mass influx."
And the Prime Minister's Special Representative on Preventing Sexual Violence in Conflict, William Hague, said he condemned reports of "horrific sexual violence and sexual slavery" being carried out by IS.
"Rape and sexual violence are grave breaches of the Geneva Conventions," he said. "All parties to the conflict must do everything in their power to protect the civilian population, including from the use of sexual violence as a weapon of war."
Earlier, former Liberal Democrat leader Lord Ashdown called for the UK government to arm the Kurds, saying doing so would enable them to "provide rescue and refuge" to those fleeing from IS.
He told BBC Radio 4's Today programme the UK needed to stop moving from assisting at one humanitarian catastrophe after another, and instead "join the dots" to form an overall strategy regarding the Middle East.
Labour's shadow foreign secretary, Douglas Alexander, said he supported the decision to make UK "military assets" available to the Kurdish forces.
Thousands of refugees have fled from IS, which is reportedly targeting Iraqi Christians and members of the Yazidi religious sect.
The UN has declared the situation in the country a "level three emergency", its highest level of humanitarian crisis.
A UN Security Council meeting on Friday was due to approve a resolution, which has been drafted by the UK and is aimed at putting more pressure on IS.
The resolution threatens sanctions against any country which finances the group, helps recruit foreign fighters, or supplies weapons.
The UK is already helping transport Soviet-era military supplies from Eastern Europe to the Kurdish forces.
It is understood a decision on whether to gift or sell weapons to the Kurds will be made if and when a formal request is approved by the UK.
In previous situations, arms have been either gifted or sold to different countries.
The RAF has been making aid drops to people fleeing IS, while the US has been carrying out airstrikes against the fighters.
Since Saturday, the UK has delivered nearly 10,000 reusable water purification containers each containing five litres of clean water as well as shelter kits and solar lamps.