Libyan rebels massed for a counter-attack against Muammar al-Qaddafi's forces in the east on Thursday, both buoyed by and wary of news of covert U.S. support and his foreign minister's defection.

"We are beginning to see the Qaddafi regime crumble," rebel spokesman Mustafa Gheriani said in the eastern town of Benghazi, while stopping short of welcoming fugitive foreign minister Moussa Koussa, a former spy chief, into the rebel fold.

Analysts agreed the defection of Koussa, who flew to London on Wednesday, was a blow to Qaddafi and belied the advantage his forces have gained on the ground in recent days. It did not, however, reduce the risk of greater government violence.

Despite almost two weeks of Western air strikes, Qaddafi's troops have used superior arms and tactics in the past few days to push back rebels trying to edge westward along the coast from their eastern stronghold of Benghazi toward the capital Tripoli.

News that U.S. officials told Reuters that President Barack Obama had authorised covert operations in Libya raised the prospect of greater support for the rebels. Experts assume special forces are on the ground "spotting" targets for air strikes. But public confirmation from Washington may indicate a willingness for greater involvement with the rebel side.

The rebels, whose main call is for weapons -- not authorised yet by Washington because of a U.N. arms embargo which NATO says it is enforcing -- said they knew nothing about Western troops in Libya and conceded too big a foreign role could be damaging.

"It would undermine our credibility," Gheriani said.

U.N. RESOLUTION

Obama's order is likely to further alarm countries already concerned that air strikes on infrastructure and ground troops by the United States, Britain and France go beyond a U.N. resolution with the expressed aim only of protecting civilians.

The top Vatican official in the Libyan capital cited witnesses on Thursday saying at least 40 civilians had been killed in Western airstrikes on Tripoli. 

NATO said it was investigating but had no confirmation of the report. Libya's state news agency, citing military sources, said Western air strikes had hit a civilian area in the capital overnight, but did not mention casualties.

The rebels fighting Qaddafi's 41-year-old rule say they desperately need more arms and ammunition to supplement supplies grabbed from government depots. The United States, France and Britain have raised the possibility of arming them, but stress that no decision has yet been taken.

NATO, which took over formal command of the air campaign on Thursday, said it would enforce a U.N. arms embargo on all sides: "We are there to protect the Libyan people, not to arm the people," NATO chief Anders Fogh Rasmussen said in Stockholm.

More Western military help may strengthen the rebels on the battlefield but at the price of a propaganda boost for Qaddafi, quick to portray his foes as lackeys of the West. 

Rebels on the front line were keen to stress they would fight on with or without Western help.
"God willing there will be more air strikes today, but we will advance no matter what," said Muneim Mustafa, a fighter with an AK-47 rifle slung over his shoulder. 


DEFECTION

They were also wary of any attempt by Koussa, a former spy chief, to negotiate immunity, saying Qaddafi and his entourage must be held accountable for its crimes: "We want to see them brought to justice, so this is a non-negotiable item," senior rebel Nation Council official Abdel Hameed Ghoga told Reuters.

British Foreign Secretary William Hague said Koussa, a former spy chief, was not being offered immunity but encouraged others around Qaddafi to follow suit.

"Qaddafi must be asking himself who will be the next to abandon him," Hague told a London news conference. Libyan officials have denied Koussa's defection and official media have ignored his departure.

A government spokesman dismissed talk of more departures, saying Qaddafi and all his sons would stay "until the end."

Rebel spokesman Gheriani said Koussa's defection was important. "Qaddafi trusted him almost more than his kids. He is a major person to defect," he told Reuters in Benghazi.

Analysts agree Koussa's defection is significant but note Qaddafi's inner circle consists of family members who may now resort to more violence to stay in power.

Rebels on Thursday still controlled Ajdabiyah, about 140 km (90 miles) southwest of Benghazi and were massing at a forward point further west, outside the oil town of Brega.

"There were clashes with Qaddafi's forces around Brega at dawn," said rebel fighter Rabia Ezela, waiting about 10 km (6 miles) outside Brega where scores of pick-up trucks mounted with machineguns, as well as other vehicles, had massed.

Italy said defections by Qaddafi's closest associates rather than Western military action would oust the Libyan leader.

"It is not through actions of war that we can make Qaddafi leave, but rather through strong international pressure to encourage defections by people close to him," Foreign Minister Franco Frattini told Canale 5 television.

FIGHTING

The leader of Qatar, the only Arab state to have recognised Libyan rebels and the first to have contributed planes to police the no-fly zone, underlined that the conflict was an internal matter in a statement, highlighting its sensitivity among Arabs.

"The Libyan question is a humanitarian issue to protect civilians and nothing else. So it is the Libyan people who will decide their future," the emir Sheikh Hamad bin Khalifa Al Thani said in comments to Qatari pan-Arab TV station Al Jazeera.

The towns of Nawfaliyah, Bin Jawad and Ras Lanuf to the east have fallen in quick succession to the lightning government counter-strike. The army ambushed the rebels outside Qaddafi's home town of Sirte, then outflanked them through the desert.

Britain said it was focusing on Misrata in the west, a rebel stronghold which has been under siege for weeks.

Rebels said Qaddafi's forces killed 18 civilians on Tuesday in the town, but lost control of the port. The U.S. Navy said it attacked three ships to stop them firing at merchant vessels.

"Right now, we are concentrating on Misrata and on how to prevent more attacks and violence from occuring in that region," a British Foreign Office spokesman told al Jazeera.

The ramshackle rebel forces lack training, discipline and leadership. There are many different groups of volunteers and decisions are often made only after heated arguments.

"We are seeking weapons that will be able to destroy the heavy weapons they are using against us such as tanks and artillery," rebel spokesman Colonel Ahmad Bani said.

"We thought it better to make a tactical withdrawal until we can think of better tactics and a strategy to face this force."