Gadafy's troops fight rebels on the streets of Brega

MISURATA – Libyan rebel forces yesterday entered the oil town of Brega and fought street battles there with forces loyal to Muammar…

MISURATA – Libyan rebel forces yesterday entered the oil town of Brega and fought street battles there with forces loyal to Muammar Gadafy, a rebel spokesman said, in the biggest offensive in eastern Libya in weeks.

“The news coming from there is there is a street war going on between Gadafy troops and the rebels, and 127 are wounded from our side,” Abdulrahman Busm, an official in the rebel National Transitional Council, said by telephone.

Brega, about 750km east of Tripoli, is the site of a strategic oil terminal. The attack could signal a new rebel push westwards from their main stronghold in the east after weeks of stalemate.

Nato, which has been bombing Libya for nearly four months, said its warplanes had struck a military storage facility in Tajoura, an eastern suburb of Tripoli. It said the depot contained battle tanks and armoured personnel carriers.

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Col Gadafy is refusing to step down despite a five-month rebellion against his rule, a campaign of Nato air strikes and defections of members of his inner circle.

The slow progress of the rebel military campaign has caused strains within Nato, with some member states pressing for a negotiated solution to bring a swift end to a conflict many thought would last only a few weeks.

In a speech on Saturday, Col Gadafy described the rebels as worthless traitors and rejected suggestions that he was about to leave the country. Reports have circulated that he is seeking a negotiated way out of the crisis.

“They said Gadafy will go to Honolulu,” he said in a televised speech. “This is funny: to leave the graves of my forefathers and my people? Are you serious?”

His defiance came a day after Western and Arab powers, led by the United States, said the rebel leadership was the legitimate government of Libya and underscored their demand that Gadafy and his family relinquish power.

Brega has changed hands several times in the back-and-forth fighting along Libya’s Mediterranean coast since the rebellion began in February.

Rebels say taking it back will be a tipping point in the conflict on the eastern front. On Saturday they said a reconnaissance unit sent into the town in preparation for an attack had clashed with government forces.

Nato aircraft have been targeting pro-Gadafy forces near Brega. The alliance said targets hit on Friday included one tank, five armoured fighting vehicles and two rocket launchers.

In the Western Mountains region southwest of Tripoli, pro-Gadafy forces exchanged artillery fire early yesterday with rebels in the village of Al-Qawalish, according to a rebel fighter manning a checkpoint there.

Meanwhile, western governments and Libya’s neighbours have expressed concern that the conflict could be exploited by Islamist militants, especially by al-Qaeda’s north African wing.

“Niger’s interest is that this crisis does not result in fundamentalists taking power [in Libya], that is our concern,” said Mahamadou Issoufou, president of Libya’s southern neighbour Niger. “Niger’s interest is that the crisis resolves itself, that it does not drag on and that the Libyan state does not go the same way as Somalia,” he said on Saturday. – (Reuters)

Bloomberg adds: Libya has about $168 billion in frozen assets and the Transitional National Council needs to access and start managing the funds as it works to oust Muammar Gadafy and rebuild the country, former central bank chief Farhat Bengdara has said.

The assets include $106 billion owned by the central bank, 55 per cent to 60 per cent of which is in government securities, and $62 billion held by the Libyan Investment Authority.

Mr Bengdara, who heads the International Libyan Bankers Association, said in an interview in Istanbul that the association was advising the council about raising finance and reviving the banking industry.