• 'It's a conspiracy to take our oil,' Gaddafi says on state TV
  • Forces re-take Gharyan, Sabratha and Brega
  • Most brutal crackdown yet a day after world urged him to step down
  • Fuel tanker explosion in Tripoli today sparks panic among residents
  • Hillary Clinton warns 'the stakes are high' as country faces civil war
  • Rebels resist attacks on Misrata, Zawiya and Zintan

As Libya teeters on the brink of full-scale civil war Colonel Gaddafi today said there was a conspiracy to the country's oil.

The Libyan leader said he was willing to discuss constitutional and legal change without arms or chaos and was ready to talk with Al Qaeda - who he blamed for the turmoil - if they had demands.

'There is a conspiracy to control the Libyan oil and to control the Libyan land, to colonise Libya once again,' he said in a televised speech before a loyal audience.

'This is impossible, impossible. We will fight until the last man and last woman to defend Libya from east to west, north to south,' Gaddafi told his supporters who punctuated the address with cheers of support and declarations of loyalty.
© AFP/Getty ImagesRanting: Gaddafi on TV, left, where he told assembled supporters of his regime that the world 'does not understand' Libya's system; right, Gaddafi leaving the hall in Tripoli

© UnknownFollowers: Supporters clapped as Gaddafi outlined his system of 'direct democracy' and insisted that Libya was not ruled 'by anyone other than its people'

'You will remain great!' chanted the crowd to Gaddafi, who was full of confidence and vigour but apparently in denial about swathes of Libya occupied by rebels.

On the sequence of events that started the unrest, Gaddafi, who in a previous speech said protesters against his rule were brain-washed by Osama bin Laden and had their milk and Nescafe spiked with hallucinogenic drugs, said: 'How did that all begin? Small, sleeper al Qaeda cells.'

Wearing long, white robes, a brown head-dress and gesticulating, Gaddafi said: 'Al Qaeda's cells attacked security forces and took over their weapons ... After Bayda, the Qaeda cells moved to Benghazi and Derna.'

Gaddafi, 68, said there were no protests against his rule in Libya and that 'underground groups'" were whipping people up and reports by the media to the contrary were wrong. There were no political prisoners in Libya, he said.

The speech came as his troops unleashed the most brutal attacks yet on protesters and army defectors in a string of towns and cities that have been lost in the uprisings since February 15.

Witnesses near the eastern town of Ajdabiyah claim two warplanes bombed the area 500 miles from Tripoli and say government forces are advancing on the town.
© Associated PressPanic: Emergency services attend to the scene of a fuel-tanker explosion, which security forces at the scene said was due to a road accident

© ReutersRising from the flames: A man waves one of the posters of Gaddafi that were distributed after a fuel tanker explosion in Tripoli this morning

As bombings and bloody battles prised back the towns of Brega, Gharyan and Sabratha, Gaddafi made the speech which was broadcast on Libyan state TV. In it he vowed to continue ruling with his system of 'direct democracy'.

The dictator of the North African regime said the world did not understand the Libyan system that 'puts power in the hands of the people'.

'We put our fingers in the eyes of those who doubt that Libya is ruled by anyone other than its people,' he told an applauding audience shown on Libyan television, referring to his system of 'direct democracy' which he outlined in his Green Book political manifesto.

He said that he was not a president and so could not resign his position, and said there were no internal problems in Libya.

'Muammar Gaddafi is not a president to resign, he does not even have a parliament to dissolve', he said, adding that he held 'no position from which to step down'.

'The Libyan system is a system of the people and no one can go against the authority of the people. .. The people are free to chose the authority they see fit,' he said.

He went on to call for the United Nations and Nato to investigate the facts about what had happened in Libya.

'I dare you to find that peaceful protesters were killed. In America, France, and everywhere, if people attacked military stores and tried to steal weapons, they will shoot them,' he said in a speech.

He urged the UN and Nato to 'set up fact-finding committees' to find out how people were killed.

Gaddafi's barrage of attacks today and last night are the most brutal retaliation yet and send a defiant message to world leaders which only yesterday had discussed military action.

Forces loyal to the Libyan leader also retook control of an oil installation in Brega, south west of Ajdabiya, according to Ahmed Jerksi, manager of the Sirte oil company which runs the facility.

A convoy of 100 military vehicles was said to be advancing on the town where an arms depot has also been bombed.

Last night, Gaddafi mercenaries battled poorly armed rebels in a wave of night-time attacks to reclaim a number of towns near the capital in order to create a buffer zone around his seat of power.

The escalating violence brought further warnings from the international community with U.S. Secretary of State Hillary Clinton saying the situation risked deteriorating into full-blown 'civil war'.

She told Congress yesterday that the U.S. must lead an international response to the crisis, including expanding already tough financial and travel sanctions against Gaddafi, his family and confidants and possibly imposing a no-fly zone over Libya.
© Press Association

© Associated PressPoised: The U.S. amphibious assault ship USS Kearsarge sails in the Suez canal in today as it edges closer to the Libyan coast after orders from Defence Secretary Robert Gates

© U.S. NavyPowerful: U.S. Navy ships of the Kearsarge Amphibious Ready Group and the Enterprise Carrier Strike Group sail in close formation in the Red Sea on February 16 - the day after Libyan protests began

'In the years ahead, Libya could become a peaceful democracy, or it could face protracted civil war. The stakes are high,' she said.

The clashes were followed by a fuel truck explosion in the capital Tripoli which officials feared could have been a deliberate act of sabotage.

Dozens of terrified resident panicked when the truck caught fire and flipped on its side as it exploded today.

Four fire engines arrived and were battling the flames. Residents attacked foreign reporters who rushed to the scene and chased them back to a nearby hotel where many of them are staying.

Gaddafi, Libya's ruler of 41 years, has already lost the eastern half of the country to rebels backed by army troops who had defected.

There are several towns near Tripoli that also fell in rebel hands but Gaddafi is now understood to have reclaimed some of them.

One of those retaken was the strategic mountain town of Gharyan, the largest in the Nafusa Mountains, which overlooks Tripoli, a resident said, speaking on condition of anonymity for fear of government retaliation.
© EPARebels without a pause: The Eastern Rebel Army in the strongest of the captured cities, Benghazi, set up military training camps to defend the eastern city against Gaddafi security forces

© EPAWeaknesses: Benghazi is the most well-armed of the captured Tripoli regions but the smaller towns around Tripoli were lost to Gaddafi mercenaries today

© Reuters
The town fell after dark Friday in a surprise attack, and the government troops detained officers who defected to the rebels and drew up lists of wanted protesters and started searching for them, the resident added.

Gaddafi supporters also have said they were in control of the city of Sabratha, west of Tripoli, which has seemed to go back and forth between the two camps in the past week.

But witnesses in Zawiya, 30 miles west of the capital, said rebels shouted 'Allahu akbar (God is great) for our victory,' and carried an air force colonel who had just defected after six hours of overnight gunbattles failed to dislodge anti-Gaddafi forces who control the city.

'We were worried about air raids but that did not happen,' said one resident, who spoke on condition of anonymity for fear of reprisals.

The more strongly armed Zawiya rebels have tanks, machine guns and anti-aircraft guns. They beat back pro-Gaddafi troops, armed with the same weapons, who attacked from six directions. There was no word on casualties.

In Misrata, 125 miles east of Tripoli, pro-Gaddafi troops who control part of an air base on the city's outskirts tried to advance yesterday. But they were beaten by opposition forces, who included residents with automatic weapons and defected army units allied with them, one of the opposition fighters said.

Amid the intensified fighting, the international community today stepped up moves to isolate the long-time Libyan leader.

And the uprisings have led to concerns of a 'humanitarian disaster' as thousands of refugees lok to flee the country.

U.S. Defence Secretary Robert Gates said he ordered two ships into the Mediterranean, including the amphibious assault ship USS Kearsarge, and he is sending 400 Marines to the vessel to replace some troops that left recently for Afghanistan.
© EPACrowds: Thousands of Egyptian residents fleeing the turmoil in Libya wait at the Libyan and Tunisian border crossing with Tunisia yesterday

© Reuters

© Getty ImagesHungry: Desperate refugees caught in a 'humanitarian crisis' reach for bread behind barbed wire while waiting to enter Tunisia yesterday

The Obama administration is conscious that it may need to flex US muscle to help usher Gaddafi out of power but is fearful of provoking even deadlier violence from a regime that has shown little restraint in attacking its own people.

The U.S. military also has no interest in getting bogged down in a third war.

Mr Gates said yesterday that any military action in the North African country must be carefully considered because it would have broad consequences for the region and the U.S. military, affecting even the effort in Afghanistan.

Military leaders weighing a no-fly zone over Libya said it would be a complex task that would require taking out Gaddafi's air defences. Russia's top diplomat distanced the country from idea which he dismissed as 'superfluous' and said world powers should focus on sanctions.

Gaddafi's son, Saif al-Islam, responded by warning Western forces not to take military action against Libya and said the country is prepared to defend itself against foreign intervention.

'If they attack us, we are ready,' he told Sky News yesterday, adding that the Gaddafis are ready to implement reforms.

Today's wave of bombings are a direct response to the proposed international intervention discussed yesterday by world leaders including David Cameron and Hillary Clinton.

Facing an unprecedented challenge to his 41-year rule, Gaddafi's regime has launched the bloodiest crackdown in a wave of uprising against authoritarian rulers in the Middle East.

Gaddafi has already lost control of the eastern half of the country but still holds Tripoli and other nearby cities.
© Associated PressRetaliation: Gaddafi responded to possible international intervention in Libya by asserting his power with a brutal crackdown on the rebel strongholds

© Associated PressWeapons: Libyan long-range missiles are displayed during a military parade hosted by Gaddafi in 1999

An exact death toll has been difficult to obtain in the chaos, but a medical committee in the eastern city of Benghazi, where the uprising began on February 15, said at least 228 people had been killed, including 30 unidentified bodies, and 1,932 wounded.

UN Secretary General Ban Ki-moon has cited reports that perhaps 1,000 have died in Libya.

Gaddafi's regime has retaken at least two towns and threatened a third, while rebels resisted attacks on three other key areas - Misrata to the east, Zawiya to the west, and the mountain town of Zintan to the south of the capital.

The move came as the U.N. adopted a an unprecedented resolution to suspend Libya from its seat on the 47-member chamber Human Rights Council

Ban Ki-moon told the General Assembly that he welcomed the decision and urged the international community to investigate allegations of human rights violations in Libya.

'The world has spoken with one voice,' he said. 'We demand an immediate end to the violence toward civilians and full respect for their fundamental human rights, including those of peaceful assembly and free speech.'

'Arms depots and arsenals have reportedly been opened to gangs who terrorize communities. There are reports that government forces have fired indiscriminately on peaceful protesters and bombed the military bases in the east of the country.'

Mr Ki-Moon added that Gaddafi's supporters 'appear to be holding a tight grip on western parts of the country, chiefly Tripoli'.