TRIPOLI Muammar Gaddafi's better armed and organized troops reversed the rapid westward advance of rebels on Tuesday as world powers meeting in London piled pressure on the Libyan leader to step down.
A conference of 40 governments and international bodies agreed to press on with a NATO-led aerial bombardment of Libyan forces until Gaddafi complied with a U.N. resolution to end violence against civilians.
It also set up a contact group comprising 20 countries and organizations, including Arab states, the African Union and the Arab League, to coordinate international support for an orderly transition to democracy in Libya.
"All of us must continue to increase the pressure on and deepen the isolation of the Gaddafi regime through other means as well," U.S. Secretary of State Hillary Clinton said after the London talks finished.
"This includes a unified front of political and diplomatic pressure that makes clear to Gaddafi that he must go."
The United States, Britain and Qatar suggested that Gaddafi and his family could be allowed to go into exile if they took up the offer quickly to end six weeks of bloodshed.
Washington and Paris also raised the possibility of arming the rebels, although both stressed no decision had been taken.
However, U.S. President Barack Obama told NBC television that he had already agreed to provide aid such as communications equipment, medical supplies and potentially transportation aid to the Libyan opposition, but no military hardware.
Without the help of air strikes, the rebels seem unable to make advances or even hold positions, and on the ground the pendulum of fighting swung back Gaddafi's way.
It took five days of foreign air strikes to pulverize Libyan government tanks around the town of Ajdabiyah before Gaddafi's troops fled and the rebels rushed in and began a 300-km (200-mile), two-day dash across the desert to within 80 km (50 miles) of the Gaddafi loyalist stronghold of Sirte.
But the rebel pick-up truck cavalcade was first ambushed, then outflanked by Gaddafi troops. Government forces retook the small town of Nawfaliyah, 120 km (75 miles) east of Sirte, and rebels said they had been pushed back a further 25 km (15 miles) to the outskirts of the larger Bin Jawad.
"The Gaddafi guys hit us with Grads (rockets) and they came round our flanks," Ashraf Mohammed, a 28-year-old rebel wearing a bandolier of bullets, told a Reuters reporter at the front.
As the onslaught began, rebels leapt behind sand dunes to fire back. After a few minutes they gave up, jumped into their pick-up trucks and sped off back toward Bin Jawad.
Reports that some Nawfaliyah residents fought alongside government troops were an ominous sign for world powers hoping to end Gaddafi's rule without a descent into all-out civil war.
In western Libya, rebels and forces loyal to Gaddafi both claimed control over parts of Misrata, Libya's third city, which has been besieged by government forces for more than a month.
State television said thousands of people were taking part in a march in support of Gaddafi in Misrata, which it said had been "cleansed of armed terrorist gangs." It was the third time the channel said Misrata had been recaptured from rebels.
A rebel spokesman called Sami said Gaddafi's forces had tried to enter the town from the east.
"Fighting is still taking place now. Random bombardment is continuing," he told Reuters by telephone from the city.
"The humanitarian situation is catastrophic. There is a shortage of food and medicine. The hospital is no longer able to deal with the situation."
LACK OF FOOD
Aid agencies are increasingly worried about a lack of food and medicines, especially in towns such as Misrata where a siege by Gaddafi's forces deprives them of access.
"It is difficult to even get water in from wells outside the town because of the positions of the forces," said Abdulrahman, a resident of Zintan in the west, cut off by pro-Gaddafi forces.
The U.N. refugee agency said it had reports of thousands of families living in makeshift shelters cut off from assistance.
Protection of civilians remains the most urgent goal of the air strikes, and British Prime Minister David Cameron accused Gaddafi's supporters of "murderous attacks" on Misrata.
A series of powerful explosions rocked Tripoli on Tuesday and state television said several targets in the Libyan capital had come under attack in rare daytime strikes.
The Pentagon said 115 strike sorties had been flown against Gaddafi's forces in the last 24 hours, and 22 Tomahawk cruise missiles had been fired.
The United States is scaling back to a "supporting role" to let NATO take full command of the air campaign from U.S. forces on Wednesday, but air strikes by U.S., French and British planes remain key to smashing Gaddafi's armor.
Obama told NBC that military pressure and international sanctions had "greatly weakened" Gaddafi, adding: "He does not have control over most of Libya at this point."
Washington says it has seen no evidence of civilian casualties of the bombardment, but Gaddafi accused Western powers of massacres of Libyan civilians in alliance with rebels who he said were al Qaeda members.
"Stop your brutal and unjust attack on our country ... Hundreds of Libyans are being killed because of this bombardment. Massacres are being mercilessly committed against the Libyan people," he said in a letter to world leaders.
"We are a people united behind the leadership of the revolution, facing the terrorism of al Qaeda on the one hand and on the other hand terrorism by NATO, which now directly supports al Qaeda," Libya's official news agency quoted him as saying.
The rebels deny any al Qaeda links and on Tuesday promised free and fair elections if Gaddafi is forced from power.
Admiral James Stavridis, head of U.S. European Command, told the U.S. Senate that intelligence on the rebel forces had shown 'flickers' of al Qaeda or Hezbollah presence, but no "detail sufficient to say there is a significant al Qaeda presence."
Clinton met the opposition Libyan National Council envoy Mahmoud Jebril before the London talks.
After the conference, she said a political resolution could include Gaddafi leaving the country, and noted that a U.N. special envoy would visit Tripoli soon to explore that option and urge Gaddafi to implement a real ceasefire.
"As you know there is a lot of reaching out that is occurring, a lot of conversations that are going on," she said.
"He will have to make a decision and that decision, so far as we're aware, has not yet been made."
Obama once again ruled out sending ground troops to Libya or directly toppling Gaddafi militarily.
"To be blunt, we went down that road in Iraq," Obama said in a televised address before the conference.
However, the United States and France both said they could consider arming the rebels. "I'm not ruling it in, I'm not ruling it out," Obama told NBC.
Washington argues that this possibility is covered by the U.N. resolution, but even its allies disagree.
"I remind you it is not part of the U.N. resolution, which France sticks to," French Foreign Minister Alain Juppe told reporters, "but we are ready to discuss it with our partners."
(Additional reporting by Angus MacSwan, Alexander Dziadosz, Edmund Blair, Maria Golovnina, Michael Georgy, Ibon Villelabeitia, Lamine Chikhi, Hamid Ould Ahmed, Marie-Louise Gumuchian, Andrew Quinn, David Brunnstrom, Steve Holland and Alister Bull; Writing by Jon Hemming and Kevin Liffey; Editing by Peter Millership)