Gaddafi defiant as West flexes military muscle (Reuters)

TRIPOLI (Reuters) – U.S. warships will pass through the Suez Canal on Wednesday on their way to Libya as Western nations put more pressure on Muammar Gaddafi to stop a violent crackdown and step aside.

The United States said Libya could sink into civil war unless Gaddafi quits amid fears that the uprising, the bloodiest against long-serving rulers in the Middle East, could cause a humanitarian crisis.

Gaddafi remained defiant and his son, Saif al-Islam, warned the West against launching military action. He said the veteran ruler would not step down or go into exile.

Italy said it was sending a humanitarian mission to neighboring Tunisia to provide food and medical aid to as many as 10,000 people who had fled violence in Libya on its eastern border.

Tunisian border guards fired into the air on Tuesday to try to control a crowd of people clamoring to cross the frontier.

About 70,000 people have passed through the Ras Jdir border post in the past two weeks, and many more of the hundreds of thousands of foreign workers in Libya are expected to follow.

"Using force against Libya is not acceptable. There's no reason, but if they want ... we are ready, we are not afraid," Saif al-Islam told Sky television.

Secretary of State Hillary Clinton told U.S. lawmakers: "Libya could become a peaceful democracy or it could face protracted civil war." The United States said it was moving ships and planes closer to the oil-producing North African state.

The destroyer USS Barry moved through the Suez Canal on Monday and into the Mediterranean. Two amphibious assault ships, the USS Kearsarge, which can carry 2,000 Marines, and the USS Ponce, were in the Red Sea and are expected to go through the canal early on Wednesday.

U.S. RULES NOTHING OUT

The White House said the ships were being redeployed in preparation for possible humanitarian efforts but stressed it "was not taking any options off the table."

"We are looking at a lot of options and contingencies. No decisions have been made on any other actions," Defense Secretary Robert Gates said.

French Foreign Minister Alain Juppe sounded a note of caution, saying military intervention would not happen without a clear United Nations mandate.

British Prime Minister David Cameron, who said Britain would work with allies on preparations for a no-fly zone in Libya, said it was unacceptable that "Colonel Gaddafi can be murdering his own people using airplanes and helicopter gunships."

General James Mattis, commander of U.S. Central Command, told a Senate hearing that imposing a no-fly zone would be a "challenging" operation. "You would have to remove air defense capability in order to establish a no-fly zone, so no illusions here," he said. "It would be a military operation."

Analysts said Western leaders were in no mood to rush into the conflict after drawn-out involvements in Afghanistan and Iraq.

Gaddafi, a survivor of past coup attempts, told the U.S. ABC network and the BBC on Monday: "All my people love me," dismissing the significance of a rebellion that has ended his control over much of oil-rich eastern Libya.

REBELS SAY STRENGTH GROWING

Rebel fighters said the balance of the conflict was swinging their way. "Our strength is growing and we are getting more weapons. We are attacking checkpoints," said Yousef Shagan, a spokesman in Zawiyah, 50 km (30 miles) from Tripoli.

A rebel army officer in the eastern city of Ajdabiyah said rebel units were becoming more organized.

"All the military councils of Free Libya are meeting to form a unified military council to plan an attack on Gaddafi security units, militias and mercenaries," Captain Faris Zwei said. He said there were more than 10,000 volunteers in the city, plus defecting soldiers.

The New York Times reported that the rebels' revolutionary council was debating whether to ask for Western air strikes on some of Gaddafi's military assets under a United Nations banner.

The Times said Abdel-Hafidh Ghoga, the council's spokesman, declined to comment on its deliberations but said: "If it is with the United Nations, it is not a foreign intervention," which the rebels have said they oppose.

The Times said there was no indication the U.N. Security Council would approve such a request, or that Libyans seeking to oust Gaddafi would welcome it.

Despite the widespread collapse of Gaddafi's writ, his forces were fighting back in some regions. A reporter on the Tunisian border saw Libyan troops reassert control at a crossing abandoned on Monday, and residents of Nalut, about 60 km (35 miles) from the border, said they feared pro-Gaddafi forces were planning to recapture the town.

Mohamed, a resident of rebel-held Misrata, told Reuters by phone: "Symbols of Gaddafi's regime have been swept away from the city. Only a (pro-Gaddafi) battalion remains at the city's air base but they appear to be willing to negotiate safe exit out of the air base. We are not sure if this is genuine or just a trick to attack the city again."

Across the country, tribal leaders, officials, military officers and army units have defected to the rebels.

Tripoli is a clear Gaddafi stronghold, but even in the capital, loyalties are divided. Many on the streets on Tuesday expressed loyalty, but a man who described himself as a military pilot said: "One hundred percent of Libyans don't like him."

The U.N. General Assembly on Tuesday unanimously suspended Libya's membership of the U.N. Human Rights Council. A U.N. Security Council resolution on Saturday called for a freeze on Gaddafi's assets and a travel ban and refers his crackdown to the International Criminal Court.

The United States has frozen $30 billion in Libyan assets.

Libya's National Oil Corp said output had halved because of the departure of foreign workers. Brent crude prices surged above $116 a barrel as supply disruptions and the potential for more unrest in the Middle East and North Africa kept investors on edge.

Britain's Daily Telegraph newspaper, citing unnamed U.S. sources, said British special forces were preparing to seize mustard gas and other potential chemical weapons in Libya.

It quoted unnamed British sources as saying they had not yet received a specific U.S. request for involvement, but officials said plans were being drawn up for "every eventuality."

(Additional reporting by Yvonne Bell and Chris Helgren in Tripoli, Dina Zayed and Caroline Drees in Cairo, Tom Pfeiffer, Alexander Dziadosz and Mohammed Abbas in Benghazi, Yannis Behrakis and Douglas Hamilton; Christian Lowe and Hamid Ould Ahmed in Algiers, Souhail Karam and Marie-Louise Gumuchian in Rabat and Samia Nakhoul, William Maclean and Alex Lawler in London; writing by Janet Lawrence; editing by Philip Barbara)

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Gaddafi defiant in face of mounting revolt (Reuters)

TRIPOLI (Reuters) – Libyan leader Muammar Gaddafi vowed defiance in the face of a mounting revolt against his 41-year rule on Tuesday, making a fleeting television appearance to scorn protesters and deny he had fled the country.

Gaddafi's forces have cracked down fiercely on demonstrators, with fighting now spreading to the capital Tripoli after erupting in Libya's oil-producing east last week. Human Rights Watch says at least 233 people have been killed.

As the fighting has intensified across the thinly populated nation stretching from the Mediterranean deep into the Sahara desert, cracks appeared among Gaddafi supporters, with some ambassadors resigning and calling for his removal.

The justice minister quit in protest at the use of force and a group of army officers called on soldiers to "join the people," while two pilots flew their warplanes to nearby Malta.

Tripoli, a Mediterranean coastal city, appeared calm in the early hours of Tuesday. One resident said: "There is heavy rain at the moment, so people are at home. I am in the east of the city and have not heard clashes."

Gaddafi appeared on television after days of seclusion to scoff at reports he had fled to Venezuela, ruled by his friend President Hugo Chavez.

"I want to show that I'm in Tripoli and not in Venezuela. Do not believe the channels belonging to stray dogs," Gaddafi said, holding an umbrella and leaning out of a van apparently outside his residence in what amounted to a 22-second appearance.

"I wanted to say something to the youths at Green Square (in Tripoli) and stay up late with them but it started raining. Thank God, it's a good thing," added Gaddafi, who has ruled Libya with a mixture of populism and tight control since taking power in a military coup in 1969.

DEMONSTRATIONS SPREAD, OIL PRICE RISES

World powers have condemned the use of force against protesters, with U.N. Secretary General Ban Ki-moon accusing Libya of firing on civilians from warplanes and helicopters.

"This must stop immediately," said Ban, adding he had spoken to Gaddafi and urged him to halt attacks on protesters. The Security Council was to hold a meeting on Libya at 9 a.m. EST (1400 GMT), diplomats said.

"The fall of Gaddafi is the imperative of the people in streets," said Ali al-Essawi, Libya's ambassador to India after resigning his post. He told Reuters that African mercenaries had been recruited to help put down protests.

Demonstrations have spread to Tripoli after several cities in the east -- including the second city Benghazi, where the protests had first erupted -- appeared to fall to the opposition, according to residents.

Residents on Monday reported gunfire in parts of Tripoli and one political activist said warplanes had bombed the city. Residents said anxious shoppers were queuing outside stores to try to stock up on food and drink. Some shops were closed.

Libyan guards have withdrawn from their side of the border with Egypt and "people's committees" were now in control of the crossing, the Egyptian army said.

Egypt's military rulers -- who took power following the overthrow of President Hosni Mubarak on February11 -- reinforced the frontier but kept the main crossing open round-the-clock to allow the sick and wounded to enter, a military source said.

The revolt in OPEC member Libya has driven oil prices sharply higher, U.S. crude futures rising close to 8 percent to more than $94 a barrel, a 2-1/2 year high.

Shell said it was pulling out its expatriate staff from Libya temporarily because of the unrest.

International Energy Agency (IEA) chief economist Fatih Birol said oil prices could rise higher if turmoil persisted in the Middle East.

WORLD CONDEMNATION

The upheavals which deposed the presidents of Tunisia and Egypt have shaken the Arab world and inspired protests across the Middle East and North Africa, threatening the grip of long-entrenched autocratic leaders.

While Human Rights Watch said at least 233 people had been killed in five days of violence in Libya, opposition groups put the figure much higher. No independent verification was available and communications from outside were difficult.

U.S. Secretary of State Hillary Clinton said it was "time to stop this unacceptable bloodshed" and EU foreign ministers also condemned the killing of protesters.

A flamboyant figure with his flowing robes and bevy of female bodyguards, Gaddafi has long been accused by the West of links to terrorism and revolutionary movements.

U.S. President Ronald Reagan once called him a "mad dog" and sent planes to bomb Libya in 1986 and he was particularly reviled after the 1988 Pan Am airliner bombing over Lockerbie, Scotland, by Libyan agents in which 270 people were killed.

But this changed when Libya gave up its weapons of mass destruction in order to secure an end its international isolation and a rapprochement with western governments keen to tap its oil wealth and other lucrative trade and investment deals.

(Reporting by Tarek Amara, Christian Lowe, Tarek Amara, Marie-Louise Gumuchian, Souhail Karam; Brian Love, Daren Butler; Writing by Jon Boyle; Editing by Angus MacSwan)

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