By Angus Macswan
AJDABIYAH, Libya (Reuters) - Libyan rebels backed by allied air strikes recaptured the strategic eastern town of Ajdabiyah on Saturday, pushing out Muammar Gaddafi's forces.
Rebel fighters danced on tanks, waved flags and fired in the air by buildings riddled with bulletholes after an all-night battle that suggested the tide is turning against Gaddafi's forces in the east.
A Reuters correspondent saw half a dozen wrecked tanks near the eastern entrance to the town and the ground strewn with empty shell casings. There were also signs of heavy fighting at the western gate, the last part of the town taken from government troops.
"Everything was destroyed last night by our forces," said rebel fighter Sarhag Agouri. Witnesses and rebel fighters said the whole town was in rebel hands by late morning.
Capturing Ajdabiyah is a big morale boost for the rebels after two weeks spent on the back foot.
Gaddafi's better-armed forces halted an early rebel advance near the major oil export terminal of Ras Lanuf and pushed them back to their stronghold of Benghazi until Western powers struck Gaddafi's positions from the sea and air.
Air strikes on Ajdabiyah on Friday afternoon seem to have been decisive.
The African Union said it was planning to facilitate talks to help end the war, but NATO said its operation could last three months, and France said the conflict would not end soon.
In Washington, a U.S. military spokeswoman said the coalition fired 16 Tomahawk cruise missiles and flew 153 air sorties in the past 24 hours attacking Gaddafi's artillery, mechanized forces and command and control infrastructure.
Western governments hope the raids, launched a week ago with the aim of protecting civilians, will shift the balance of power in favor of the Arab world's most violent popular revolt.
In Tripoli, explosions were heard early on Saturday, signaling possible new strikes by warplanes or missiles.
GADDAFI OFFERS PROMOTIONS
Libyan state television was broadcasting occasional, brief news reports of Western air strikes. Mostly it showed footage -- some of it grainy images years old -- of cheering crowds waving green flags and carrying portraits of Gaddafi.
Neither Gaddafi nor his sons have been shown on state television since the Libyan leader made a speech from his Tripoli compound on Wednesday.
State TV said the "brother leader" had promoted all members of his armed forces and police "for their heroic and courageous fight against the crusader, colonialist assault."
The United States said Gaddafi's ability to command and sustain his forces was diminishing.
Officials and rebels said aid organisations were able to deliver some supplies to the western city of Misrata but were concerned because of government snipers in the city center.
Gaddafi's forces shelled an area on the outskirts of the city, killing six people including three children, a rebel said.
Misrata has experienced some of the heaviest fighting between rebels and Gaddafi's forces since an uprising began on February 16.
At African Union headquarters in Addis Ababa, AU commission chairman Jean Ping said on Friday the organization was planning to facilitate peace talks in a process that should end with democratic elections.
It was the first statement by the AU, which had opposed any form of foreign intervention in the Libya crisis, since the U.N. Security Council imposed a no-fly zone last week and air strikes began on Libyan military targets.
But in Brussels, a NATO official said planning for NATO's operation assumed a mission lasting 90 days, although this could be extended or shortened as required.
France said the mission could go on for weeks.
(Reporting by Mohammed Abbas in Benghazi, Tim Castle in London, Maria Golovnina and Michael Georgy in Tripoli; writing by Tom Pfeiffer and Myra MacDonald; editing by Andrew Roche)