By Alexander Dziadosz
RAS LANUF, Libya (Reuters) - Libyan warplanes struck at rebel forces behind the war's eastern frontlines on Tuesday, stepping up the government offensive to roll back their early gains in the insurrection against Muammar Gaddafi.
Reuters correspondents reported at least four air strikes near rebel positions in and around the oil town of Ras Lanuf on the Mediterranean coast. One hit a civilian home.
In the west, government artillery and tanks pounded Zawiyah, the closest rebel-held city to the capital Tripoli, destroying many houses and trapping residents.
Earlier, the rebels said they had rejected an offer from the Libyan leader to negotiate his surrender of power. But the government denied any such talks had taken place and appeared to be making a robust military effort to crush the uprising.
On the international front, Britain and France led a drive at the United Nations for a no-fly zone over Libya, a move that would prevent Gaddafi from unleashing air raids on rebel fighters and towns or from flying in reinforcements.
But the U.S. government resisted pressure from some U.S. lawmakers for direct intervention, saying it first wanted to figure out what military options could achieve in the oil-producing desert state.
Tuesday's airstrikes hit at rebels behind the no-man's land between the coastal towns of Ras Lanuf and Bin Jawad, about 550 km (340 miles) east of Tripoli and the site of oil terminals.
One strike smashed a house in a residential area of Ras Lanuf, gouging a big hole in the ground floor. Many homes, including the one hit, appeared to be evacuated and there were no immediate reports of casualties.
Other attacks targeted rebel positions on the outskirts of the Ras Lanuf oil terminal.
Mustafa Askat, an oil worker, said one bomb had wrecked a water line and this would affect water supplies to the city.
"We have a hospital inside, we have sick people and they need water urgently," he said.
The rebel army -- a rag-tag outfit largely made up of young volunteers and military defectors -- had made swift gains in the first week of the uprising which saw them take control of the east and challenge the government near Tripoli.
But their momentum appears to have stalled as Gaddafi's troops pushed back using war planes, tanks and heavy weapons.
Rebels said government forces had dug in their tanks near Bin Jawad while rebels retreated to Ras Lanuf. The two towns are about 60 km (40 miles) apart on the strategic coastal road along the Mediterranean sea that leads to Tripoli.
DESTROY THE CITY
Gaddafi's forces also made a concerted attack with tanks and artillery on Tuesday to recapture Zawiyah, about 50 km (30 miles) west of Tripoli near an important oil refinery, according to a resident and an Arabic television station.
The resident said government forces were "trying to destroy the city," according to a friend who managed to make a brief phone call to Zawiyah.
"Many buildings are completely destroyed, including hospitals, electricity lines and generators," he said.
"People cannot run away, it's cordoned off. They cannot flee. All those who can fight are fighting, including teenagers. Children and women are being hidden, he said."
A government spokesman, Mussa Ibrahim, said the government was in control of the city, adding however that a small group of fighters was still putting up resistance.
"There are still pockets of resistance, maybe 30-40 people, hiding in the streets and in the cemetery. They are desperate," he told Reuters in Tripoli.
In the rebel-held city of Misrata, between Tripoli and the eastern frontline, the wounded were treated on hospital floors because of a shortage of medical facilities, a resident said.
Gaddafi also appears to be tightening his grip in the capital and the movements of foreign correspondents there have been restricted.
OVERTURE OR NOT?
A spokesman for the rebel National Libyan Council said it had spurned an overture from Gaddafi's camp for talks on him relinquishing power.
"We are not negotiating with someone who spilled Libyan blood and continues to do so. Why would we trust the guy today?" spokesman Mustafa Gheriani told Reuters.
But a Libyan foreign ministry official later denied Tripoli had floated a proposal under which Gaddafi, who has ruled since seizing power in a 1969 military coup, could step down in exchange for guarantees about his future.
The reports were "absolute nonsense," he said.
One of Gaddafi's sons, Saadi, said in an interview with Al Arabiya television his father had not yet thrown his army into full battle against the rebels.
"The tribes are all armed, there are forces from the Libyan army and the eastern region is armed. The situation is not like Tunisia or Egypt," said Saadi, an ex-professional footballer in Italy.
U.N. aid coordinator Valerie Amos said the fighting across Libya meant that more than a million people fleeing or inside the country needed humanitarian aid.
"Humanitarian organizations need urgent access now," she said. "People are injured and dying and need help immediately." The United Nations appealed for $160 million for an operation over the next months to prepare shelter, food and medicine.
British Foreign Secretary William Hague said London was talking to its allies on a resolution for a no-fly zone, including an "appropriate legal basis." A French source said France also was working on such an initiative.
The Arab League and several Gulf states have also called for a no-fly zone, important support given suspicions in the Muslim world about Western intentions following the U.S.-led interventions in Iraq and Afghanistan.
U.S. Defense Secretary Robert Gates said action should be taken only with international backing. The White House said all options were on the table, including arming rebels.
Russia, a permanent member of the U.N. Security Council with veto powers, said it opposed foreign military intervention.
China was also cool to the no-fly zone proposal.
"We believe, Libya's sovereignty, territorial integrity and independence should be respected," a Chinese Foreign Ministry spokeswoman said in Beijing.
The Libyan uprising is the bloodiest of a tide of pro-democracy protests against autocratic rulers and monarchs in North Africa and Middle East which has already seen the longtime leaders of Tunisia and Egypt dethroned this year.
The phenomenon has left the West struggling to formulate a new direction for a region that sits on vast reserves of oil and where stability was until now the political priority.
Shipping sources said the fighting had closed the Ras Lanuf terminal and the oil port of Brega. Brent crude prices rose above $118 a barrel on Monday before falling back to $115 and U.S. prices pushed to their highest level since September 2008.
Youcef Yousfi, president of the Organization of Petroleum Exporting Countries, said there were no plans for a crisis meeting of the group and high prices were short term.
(Additional reporting by Michael Georgy in Tripoli, Alexander Dziadosz in Ajdabiya, Mohammed Abbas in Ras Lanuf, Stefano Ambrogi in London, Writing by Angus MacSwan: Editing by Giles Elgood)