By Maria Golovnina and Mohammed Abbas
TRIPOLI/RAS LANUF, Libya (Reuters) - Libyan rebels said they had repelled a fierce attack by Muammar Gaddafi's forces on the western town of Zawiyah on Saturday and were pushing toward his home town Sirte from the east.
"They entered Zawiyah at six in the morning with heavy forces, hundreds of soldiers with tanks. Our people fought back ...We have won for now and civilians are gathering in the square," said Youssef Shagan, the rebel force spokesman in Zawiyah, 50 km (30 miles) west of the capital Tripoli.
People opposed to Gaddafi's 41-year rule have been fighting his forces in Zawiyah for more than a week, after rebels took over swathes of eastern Libya in an uprising inspired by the overthrow of longterm rulers in Egypt and Tunisia this year.
A rebel fighter in the center of the Mediterranean town said by telephone that Gaddafi's forces were re-grouping at its entrance after being pushed back on Saturday morning.
"Gaddafi will never enter this city. He will never set foot here. The only way for him to enter the city is when we are all dead. He has to kill us all to control the city," said the rebel, who gave his name as Ibrahim.
Al-Jazeera television cited rebels saying Gaddafi was sending reinforcements to the town.
Shagan said earlier Gaddafi forces had fired high explosive rounds in central streets and dragged people from their homes. There were many casualties among civilians, rebels and soldiers, he said, although he could not give a precise number.
"We captured 3 APCs, two tanks and one pick-up after an hour and a half of fighting," he said, adding that there were government snipers in Zawiyah.
Rebels in eastern Libya said they were pushing further west on Saturday after driving out forces loyal to Gaddafi from the oil town of Ras Lanuf a day earlier. They said they had fired on an army helicopter swooping over Ras Lanuf on Saturday.
Doctors said at least 26 people had died in Friday's fighting around Ras Lanuf and what rebels said was an attack by Gaddafi's forces on an arms store on the edge of the eastern town of Benghazi, where the uprising began in mid-February.
Rebel fighters said they had taken the town of Bin Jawad some 525 km east of Tripoli and were moving on toward Sirte, Gadaffi's heavily guarded home town.
There was no sign of Gaddafi's forces or rebels in Bin Jawad on Saturday morning. Some rebels said they had sent reconnaisance missions there while the main rebel force amassed in Ras Lanuf to move ahead.
The latest fighting suggested front lines between his forces and the rebels, who are fighting with everything from captured tanks to sticks, were far from clear and could shift quickly.
The rebel flag waved over a major roundabout in Ras Lanuf on Saturday and there was no sign of pro-Gaddafi soldiers, although the government had denied the rebel claim on Friday to be in control of the town, 660 km east of Tripoli.
A day earlier, flashes and thuds had resounded from fighting around Ras Lanuf, an oil terminal of the OPEC producer that sits on the Mediterranean coast. Helicopters had strafed positions of rebels, who fired rifles back.
At the entrance to the town on Saturday, half a dozen soldiers manned a rebel checkpoint. Asked if rebels were in charge of the whole town, one soldier replied: "Everything, 100 percent, it is completely safe."
Inside the town it was calm. About 25 people were queuing for bread.
"It's not a normal situation, but you have to be prepared for this situation. I am very pleased, we all are. We are finished with Gaddafi," said Saleh Mohamed, 37, works as an administrator in an oil firm.
The revolt is the bloodiest yet against long-entrenched rulers common across the Middle East and North Africa. The past few weeks saw the overthrow of the veteran presidents of Tunisia and Egypt -- Libya's western and eastern neighbours.
In diplomacy aimed at quelling upheaval that has jacked up oil prices, a group of mostly Latin American states in a leftist bloc behind Venezuelan President Hugo Chavez endorsed his plan on Friday for an international mediating mission on Libya.
But Chavez's chances looked slim for now since the rebels have ruled out talks unless they lead to Gaddafi's resignation or exile, outcomes he has categorically ruled out.
Disaffected Libyans see Chavez as too close to Gaddafi, whom the Venezuelan leader calls a friend. It was unclear whether the plan has gained any traction with other countries.
News of the fighting thrust U.S. crude prices to their highest levels since September 2008, and Brent crude futures for April delivery rose $1.36 to $116.17 a barrel.
The International Energy Agency said the revolt had blocked about 60 percent Libya's 1.6 million bpd (barrels per day) oil output. The loss, due largely to the flight of thousands of foreign oil workers, will batter the economy.
The upheaval has caused a humanitarian emergency on the Tunisian border where tens of thousands of foreign workers have fled to safety. An international airlift is under way, reducing the number of refugees stranded in tented camps.
Western leaders have urged Gaddafi to go and are considering various options including the imposition of a no-fly zone, but are wary about involving their militaries after wars in Afghanistan and Iraq deeply unpopular at home.
(Additional reporting by Mohammed Abbas in Ras Lanuf, Michael Georgy in Tripoli and Mohammed Abbas in Ras Lanuf; writing by Mark Heinrich and Philippa Fletcher; editing by Angus MacSwan)