Syrian forces stormed student dormitories during an anti-government protest at Aleppo University Thursday, firing tear gas and bullets in an hours-long siege that killed at least four students and forced the closure of the state-run school, activists said.

U.N. truce observers toured other restive parts of the country, and residents told them of being too terrified to walk on the streets after dark as the 14-month-old uprising rages on. The U.N. estimates 9,000 people have been killed since the revolt began, and a peace plan brokered by international envoy Kofi Annan nearly a month ago has done little to stem the bloodshed.

In Washington, White House spokesman Jay Carney admitted the plan might be doomed.

"If the regime's intransigence continues, the international community is going to have to admit defeat," he said, adding that new measures might have to be taken, including a return to the U.N. Security Council. He gave no further details.

It was not clear how long the university would remain closed following the siege, which began late Wednesday when around 1,500 students held a protest against President Bashar Assad's regime. Pro-regime students attacked the crowd with knives before security forces swept in, firing tear gas and then live ammunition, activists said.

"Some students ran to their rooms to take cover, but they were followed to their rooms, beaten up and arrested," student activist Thaer al-Ahmed said. "Others suffered cuts and broken bones as they tried to flee."

Raids and intermittent gunfire continued for about five hours through early Thursday, he said, adding that dozens of people were wounded, some critically, and 200 students were arrested.

The student quarters _ known as the University City _ comprise 20 dormitories that house more than 5,000 students next to the university campus. Students there often shout anti-Assad slogans from their rooms at night.

It was an unusually violent incident in Aleppo, a major economic hub that has remained largely loyal to Assad and has been spared the kind of daily bloodshed that has plagued other Syrian cities over the course of the uprising.

There has been a string of bombings near government security buildings in Aleppo and the capital, Damascus, adding a mysterious element to the anti-government revolt. U.S. officials suggested al-Qaida militants may be joining the fray.

For the most part, Aleppo has been quiet, but university students _ many from rebellious areas such as the northern Idlib province _ have been staging almost daily protests calling for the fall of Assad.

Al-Ahmed, a law student, said the Aleppo campus and dormitories have been raided before, but Thursday was the most violent incident.

Amateur videos showed a large number of security forces apparently storming the dorms Wednesday night. Another showed a student protest earlier the same day with shouts of: "We don't want you, Bashar!" One showed the campus with windows shattered and a man dousing a smoldering fire with a bucket of water.

The authenticity of the videos could not be confirmed.

The Local Coordination Committees activist group said five students were killed and some 200 arrested in the raids, while the British-based Syrian Observatory for Human Rights put the death toll at four. The Syrian government has prevented independent reporting in the country, making it impossible to independently verify casualty figures.

"Regime forces demanded through loudspeakers that the dorms be evacuated, then began detaining the students," the LCC said in a statement.

Al-Ahmed and the Observatory's director Rami Abdul-Rahman said pro-regime students armed with knives tried to break up the protest before the security forces raided the dorms.

Syria's persistent bloodshed has tarnished efforts by a U.N. team of observers to salvage the truce that was brokered by Annan but which started to unravel almost as soon as it was supposed to begin on April 12.

The two sides have blamed each other for thwarting the truce, with Assad's forces trying to repress demonstrators calling for him to step down. The regime also is facing an armed rebellion that has sprung up as peaceful protests have proved ineffective against his forces.

The head of the U.N. observers, Norwegian Maj. Gen. Robert Mood, visited the central cities of Homs and Hama, where anti-regime sentiment runs high. He said there is still "a good chance and an opportunity" to break the cycle of violence.

"I call on all the parties to stop the violence," Mood told reporters. "If you use military force, it creates more force, it creates more violence ... so it should always be the last resort."

Reporters accompanying the observers on the tour interviewed residents who said life was fairly normal during the day but was worrisome after dark.

"The situation is calm during the day but scary at night," said Maher Jerjous, a 53-year-old resident of the Bab al-Quba district in Hama. "Masked gunmen ... roam the streets. There are kidnappings on public roads. You will not see anyone (on the streets) after six."

Despite the violence, the international community still sees Annan's plan as the last chance to prevent Syria from falling into civil war _ in part because no other country wants to intervene militarily.

The unrest also is eviscerating the economy, threatening the business community and prosperous merchant classes that are key to propping up the regime. The opposition has tried to rally these largely silent, but hugely important, sectors of society. Assad's opponents have failed so far to galvanize support in Damascus and Aleppo _ the two economic centers in Syria.

Masood Ahmed, the director of the International Monetary Fund's Middle East and Central Asia department, said in an interview that the conflict is damaging the economy.

"This year, we do anticipate there will be a significant contraction in the economy," he told The Associated Press by phone during a visit to the United Arab Emirates.

Ahmed acknowledged that the unrest makes it difficult to determine how much the economy is suffering. He said the extent of the damage will depend on how the conflict plays out, what aid Syria gets from outside, and how much effect a September ban by the European Union on Syrian oil imports is affecting the country.

Some 95 percent of Syria's oil used to go to the EU, and revenue from those sales made up for a quarter of the country's budget, Ahmed said. He added that there is evidence private-sector Syrian banks are facing a wave of withdrawals, with about a quarter of deposits being pulled out.

"Apart from this terrible human toll, the conflict clearly has an impact on Syria economically," he said.

In other violence, state-run news agency SANA said that gunmen assassinated Ismail Haidar, the son of the Syrian Social Nationalist Party's leader, on Wednesday. Haidar was shot dead by "terrorists" on the highway from Homs to Misyaf, it said.

Haidar's father is also a member of the Popular Front for Change and Liberation, which calls for peaceful, democratic change in Syria but is considered by some to be close to the regime.

The Observatory also said that Bassel Raya, a former basketball player who played on the Syrian national team, died Thursday from wounds suffered last week when he was shot by gunmen in a Damascus suburb.

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AP Business Writer Adam Schreck in Dubai, United Arab Emirates, and AP writer Albert Aji in Hama, Syria, contributed to this report.