By Mohammed Abbas
BENGHAZI, Libya (Reuters) - Libyan leader Muammar Gaddafi's forces pushed into the rebel-held city of Benghazi on Saturday, defying world demands for an immediate ceasefire and forcing rebels to retreat.
The advance into Libya's second city of 670,000 people appeared to be an attempt to pre-empt Western military intervention which diplomats say will come only after an international meeting on Paris on Saturday.
A Libyan rebel spokesman said Gaddafi's forces had entered Benghazi while a Reuters witness saw a jet circling over the city shot down and at least one separate explosion near the rebel movement's headquarters in the city.
"They have entered Benghazi from the west. Where are the Western powers? They said they could strike within hours," rebel military spokesman Khalid al-Sayeh told Reuters.
Gaddafi said Western powers had no right to intervene.
"This is injustice, this is clear aggression," government spokesman Mussa Ibrahim quoted Gaddafi as saying in a letter to France, Britain and the United Nations. "You will regret it if you take a step toward interfering in our internal affairs."
The Libyan government blamed the rebels, who it says are members of al Qaeda, for breaking the ceasefire around Benghazi.
As explosions shook Benghazi, rebel fighters said they were being forced to retreat from the outskirts of the city where the revolt against Gaddafi began a month ago.
An unidentified fighter jet was shot down over Benghazi.
"I saw the plane circle around, come out of the clouds, head toward an apparent target, and then it was hit and went straight down in flames and a huge billow of black smoke went up," Reuters correspondent Angus MacSwan said.
"It seems it was attacking the Benghazi military barracks."
REBEL CITY DOUBTS WEST
Benghazi residents were angry at the West's delay. "Europe and America have sold us out. We have been hearing bombing all night, and they have been doing nothing. Why? we have no one to help us but God," said Hassan Marouf, 58, standing outside the door of his house in Benghazi.
"Us men are not afraid to die, but I have women and children inside and they are crying and in tears. Help us."
The French ambassador to the United Nations said he thought Western powers would not take military action till after the Paris meeting, attended by U.S. Secretary of State Hillary Clinton and Arab leaders.
"Everything is ready but the decision is now a political one," said a French government source. "It's clear we have to move quickly."
Clinton, British Prime Minister David Cameron and French President Nicolas Sarkozy are to meet around 1130 GMT in Paris, an hour before the wider talks, a U.S. official said. That could indicate Western military action may start slightly sooner.
Ambassadors from the 28 NATO states adjourned a meeting in Brussels on Saturday to discuss possible NATO involvement in policing Libyan skies till after the talks in Paris.
Meanwhile, rebels said Libyan jets had bombed the road to Benghazi airport and elsewhere on the outskirts.
"They have just entered Benghazi and they are flanking us with tanks, missiles and mortars," Fathi Abidi, a rebel supporter who works on logistics, said at the western entrance to the city where about three quarters of million people live.
He pointed to a black smoke plume on the city's boundaries.
Inside the city, residents set up make-shift barricades with furniture, benches, road signs and even a barbecue in one case at intervals along main streets. Each barricade was manned by half a dozen rebels, but only about half of those were armed.
Elsewhere in the city, rebels reported skirmishes and strikes by Gaddafi forces.
"Fighter jets bombed the road to the airport and there's been an air strike on the Abu Hadi district on the outskirts," Mohammed Dwo, a hospital worker and a rebel supporter, told Reuters.
"ATTACKS MUST STOP"
Within hours of President Barack Obama saying the terms of a U.N. resolution meant to end fighting in Libya were non-negotiable, his U.N. envoy Susan Rice, asked by CNN whether Gaddafi was in violation of these terms, said: "Yes, he is."
Obama made clear any military action would aim to change conditions across Libya -- rather than just in the rebel-held east -- by calling on Gaddafi's forces to pull back from the western cities of Zawiyah and Misrata as well as from the east.
"All attacks against civilians must stop," Obama said, a day after the U.N. Security Council passed a resolution authorizing international military intervention.
"Gaddafi must stop his troops from advancing on Benghazi, pull them back from Ajdabiya, Misrata and Zawiyah, and establish water, electricity and gas supplies to all areas. Humanitarian assistance must be allowed to reach the people of Libya ...
"Let me be clear, these terms are not negotiable... If Gaddafi does not comply ... the resolution will be enforced through military action."
Libyan government forces fired artillery shells into the rebel-held city of Misrata early and pro-Gaddafi snipers killed two people in the city on Saturday, and water supplies were still cut off, residents said.
(Reporting by Mohammed Abbas and Angus MacSwan in Benghazi, Tom Perry in Cairo, Maria Golovnina and Michael Georgy in Tripoli, Hamid Ould Ahmed and Christian Lowe in Algiers; Writing by Jon Hemming; Editing by Giles Elgood)