By Loucoumane Coulibaly and Tim Cocks
ABIDJAN (Reuters) - Fighting flared in a strategic town in western Ivory Coast on Wednesday, killing at least two people, with five more killed in Abidjan, as security forces cracked down on pro-Ouattara neighborhoods.
Supporters of presidential claimant Alassane Ouattara denied involvement in the fighting in the west.
Residents of Duekoue reported several hours of heavy and small arms fire in the town, which has seen years tensions but has remained under the control of incumbent leader Laurent Gbagbo since a 2002-3 war divided the country.
Rebels who seized the north of the country during the war and who now back Ouattara, internationally-recognized winner of a November poll that Gbagbo refuses to cede, denied involvement.
The push in the west and heavy fighting in Ivory Coast's main city Abidjan have sparked fears that an election meant to reunify the country could instead rekindle civil war.
Security in the main commercial city has been rapidly deteriorating since gunmen claiming allegiance to Ouattara took over its northern suburb, prompting pro-Gbagbo forces and allied youth militias to set up roadblocks and kill suspected ouattara supporters.
Those gunmen advanced across Abidjan on Monday, bringing their fight closer to the city center and presidential palace.
Witnesses said security forces cracked down on Ouattara supporters and suspected rebels in Williamsville and Port Bouet 2, areas of west Abidjan, killing at least three.
"There is shooting everywhere as the security forces patrol the neighborhood," said Port Bouet 2 resident Alidou Dao. "Lots of people are leaving."
A resident of Williamsville saw his neighbor and two other people on his street dragged out of their homes by gunmen in police uniforms who then slit their throats. The police spokesman was not immediately available for comment.
The violence had driven cocoa futures to 30-year highs, until an earthquake in Japan triggered falls in commodities markets.
The U.N. estimates some 400 people have been killed and another 450,000 forced from their homes.
New York-based Human Rights Watch has said atrocities committed by forces loyal to Gbagbo have been organized on a scale that may constitute war crimes, while gunmen backing Ouattara were also accused of executions.
In Attecoube, right next to the town center where the U.N. peacekeeping mission is based, armed pro-Ouattara youths attacked and burned down a local police station, and two were killed by police firing to repel them.
"The youths arrived, some armed with guns, some with stones. They attacked the police who fired to repel them, then fled," said witness Junior Seiba. "I saw two dead protesters."
Duekoue was later calm after the fighting but thousands fled to the local Catholic mission to seek shelter, a resident said.
Other towns in Ivory Coast's west have been fought over since the post-election power struggle began. Duekoue is the most strategically important as it sits on the main road from the west to the cocoa-producing center-west regions.
New Forces (FN) rebels have gained ground after threatening a push south to try and resolve a power struggle that has brought the country to the brink of civil war and strangled the flow of cocoa beans from the world's top grower.
A number of local conflicts over land, ethnicity and the use of mercenaries during the war have long simmered around Duekoue.
Citing a grenade attack that killed one and wounded 18, the U.N. peacekeeping mission in Ivory Coast on Wednesday called for an end to the escalation of violence. French medical aid group Medecins Sans Frontieres warned the crisis was seriously restricting people's access to healthcare.
Ouattara told Gbagbo on Tuesday that an African Union offer last week of a safe exit was his last chance to leave power peacefully.
But he has so far officially distanced himself from gunmen apparently fighting for his cause.
(Additional reporting by Ange Aboa and David Lewis; Writing by David Lewis and Tim Cocks; editing by Ralph Boulton)