SANAA (Reuters) - Yemen's president on Wednesday visited a town close to the capital that was captured by Shi'ite Muslim Houthi fighters this month, and said all sides had agreed to allow the state to retake control, state news agency Saba reported.
President Abd-Rabbu Mansour Hadi went to Amran, 50 kms (30 miles) north of Sanaa, to check on efforts to "return the situation in the city to normal and address the effect of the unfortunate events of armed confrontation that took place recently," Saba said.
The fighting killed at least 200 people, displaced more than 35,000 and increased concerns of further turmoil in a country also struggling with a secessionist movement in its south and attacks by Al Qaeda in the Arabian Peninsula (AQAP).
Hadi said all parties had agreed to withdraw fighters from Amran province. He also pledged 5 billion rials ($23.3 million) to rebuild property damaged in the fighting, Saba reported.
The Houthis rebels, named after their leader's tribe, have said their fight was against rivals loyal to the Islamist Islah party - which has links to the Sunni Muslim Brotherhood - rather than the government, and that they had no intention of attacking Sanaa.
Yemeni analyst Abdulghani al-Iryani, said Hadi's visit was likely to bolster the Houthis.
"This underlines the government's position that the fighting in Amran is not between the state and the Houthi movement but between Islah and tribal allies and the Houthis," he told Reuters.
Earlier this month, the Houthis handed back an army camp they had captured in Amran to the government, a move seen as an attempt to defuse tensions.
In a sign of continuing instability elsewhere in Yemen, five government soldiers were killed when they confronted tribesmen trying to stop engineers repairing an oil pipeline blown up earlier this month, a local official said.
Tribesmen bombed the main oil export pipeline in the restive Maarib province in central Yemen on July 12, depriving the impoverished country from an important source of revenue. [ID:L6N0PN02U]
Two tribesmen were killed in Wednesday's clash, the official said. "The army has instructions to open the road by force for the engineers, and the situation is tense," he added.
The Maarib pipeline carries around 70,000-110,000 barrels per day of Marib light crude from Safer oilfields to Ras Isa oil terminal on the Red Sea, the official said. It was repaired in late May after a previous attack by tribesmen. [ID:nL6N0OG1IO]($1 = 214.8500 Yemen Rials)
(Reporting by Mohammed Ghobari and Angus McDowall; Writing by Sami Aboudi; Editing by Robin Pomeroy)