Outraged Western governments scrambled to craft a collective response to the crisis in the oil-rich North African state, including possible sanctions against Kadhafi´s remaining loyalists and a freeze on assets they are believed to have salted away abroad.[break]
But governments were constrained by fears of reprisals against nationals still stranded amid what escaping expatriates described as hellish scenes as evacuation efforts dragged on on the 11th day of the crisis.
In Az-Zawiyah, west of Tripoli, 23 people were killed and 44 wounded on Thursday when regime loyalists mounted a ferocious rearguard action against protesters in the key oil refinery town, Libya´s Quryna paper reported.
"The wounded cannot reach the hospitals because of shots being fired in all directions," said the paper, based in the opposition-held eastern city of Benghazi quoting its correspondent in Az-Zawiyah.
Heavy fighting was also reported in Libya´s third city Misrata, to the east of capital.
In Zouara, further west towards the Tunisian border, fleeing Egyptian workers said the town was in the control of civilian militias after fierce fighting on Wednesday evening.
Addressing his divided nation on Thursday for the second time in three days, Kadhafi, 68, accused residents of Az-Zawiyah of siding with Al-Qaeda.
"It is obvious now that this issue is run by Al-Qaeda," he said, addressing the town´s elders.
In marked contrast to a 75-minute address from a podium outside his Tripoli home on Tuesday, Kadhafi spoke by telephone from an undisclosed location for barely 20 minutes.
His decision not to make an on-screen appearance raised questions about his whereabouts and the extent of his remaining power base, which has been hit by a new defection -- that of his cousin and close aide Kadhaf al-Dam, who quit "all his official functions," Egypt´s official MENA news agency reported.
In Paris, protesters calling themselves the "children of the revolution" occupied the Libyan embassy and hoisted the old national flag from before Kadhafi´s 1969 coup, the latest in a string of foreign missions to fall from his control.
In Tripoli, the streets were largely deserted and shops closed on the Muslim day of rest.
The UN´s World Food Programme warned Libya´s food distribution system was "at risk of collapsing", in an oil-producing country which is heavily dependent on imports that have largely come to a halt.
Libya´s second city of Benghazi, where the unprecedented protests against Kadhafi´s four-decade rule first erupted, was firmly in the hands of his opponents, an AFP correspondent said.
But the initial euphoria of the city´s liberation was giving way to fear that its weak defences could be vulnerable to a counter-attack by regime loyalists.
Effigies apparently of Kadhafi hung from street lamps in the eastern city and children played on top of an abandoned tank.
In the courthouse outside which the demonstrations started, regime opponents set up a revolutionary headquarters to take over the administration of the city as civilian militiamen and mutinous regular army troops patrolled the streets.
Some soldiers were selling their weapons to the highest bidder even as their defecting commanders strove to forge their men into a defence force.
Leading an international outcry over the regime´s brutal crackdown, US President Barack Obama consulted the leaders of Britain, France and Italy on how to "immediately" respond.
France and Britain have proposed the UN Security Council pass a sanctions resolution including a total arms embargo against Libya, French Foreign Minister Michele Alliot-Marie said.
She said the two governments would also propose bringing members of the Libyan regime before the International Criminal Court for crimes against humanity.
In Geneva, the UN Human Rights Council met in special session to consider calls to expel Libya over a crackdown which High Commissioner Navi Pillay said was "escalating alarmingly with reported mass killings, arbitrary arrests, detention and torture of protesters."
EU foreign affairs chief Catherine Ashton said it was time for the 27-nation bloc to adopt "restrictive measures" of its own against Kadhafi´s regime, which could include an assets freeze and a travel ban.
US officials said no option had been ruled out, but State Department spokesman Philip Crowley stressed the extreme sensitivity of the situation.
"Whatever steps that we do take, we want them to be effective. And we certainly don´t want to take any actions that put either our citizens or the citizens of other countries at risk," he said.
Western governments faced mounting domestic criticism for their failure to organise an evacuation operation more speedily as oil workers stranded in remote camps in Libya´s vast desert spoke of their equipment and supplies being looted amid growing lawlessness.
Italy is preparing a "military operation" to rescue some nationals trapped in the southeast whose food supplies have run out, Defence Minister Ignazio La Russia said.
European governments are making "contingency plans" to police Libyan airspace but "the EU needs a UN Security Council resolution first," a diplomat said on condition of anonymity.
Crude prices rose again slightly in late Asian trade on Friday as markets continued to fret about the turmoil despite a promise from the OPEC oil cartel to make up for any loss of production in Libya.
After dipping sharply earlier in the day, New York´s main contract, light sweet crude for April delivery, rose 36 cents to $97.64 per barrel. Brent North Sea crude for April was up $1.26 at $112.62.
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