LIBYA’s Colonel Gaddafi has dramatically escalated his military campaign to attempt to crush the two-week uprising against his regime.

Colonel Gaddafi launched his biggest counter-offensive yet against opposition forces to try to deliver a knockout blow.

Battles raged around five of Libya’s largest cities – Misrata, Zawiyah, Ras Lanuf, Bin Jawad and Sirte – as Britain was forced to admit that its secret attempt to begin negotiations with the rebels had ended ignominiously after opposition forces arrested a diplomat and a protection squad inserted clandestinely by helicopter.

“The team went to Libya to initiate contacts with the opposition. They experienced difficulties, which have now been satisfactorily resolved,” said Foreign Secretary William Hague in a statement after the men were sent home. The eight-man group reportedly comprised a diplomat and SAS soldiers.

“We do not know the nature of their mission. We refused to discuss anything with them due to the way they entered the country,” spokesman Abdul Hafiz Ghoqa said in the rebel stronghold Benghazi.

Fighting was heaviest in Misrata, the closest rebel-held town to Tripoli, which was attacked by government tanks and artillery through the day.

A doctor in Misrata told the BBC that the situation was “very bad” and that government forces had fired indiscriminately at civilians in the streets.

He said hundreds had been injured and that the government’s firepower was four times that of the opposition.

Reports of untold numbers of “injured and dying” in the city prompted a UN demand for urgent access.

“Humanitarian organisations need urgent access now,” said UN emergency relief coordinator Valerie Amos.

“People are injured and dying and need help immediately. I call on the authorities to provide access without delay to allow aid workers to help save lives.”

Residents of Misrata, strategically located between the capital Tripoli and Sirte, earlier warned of “carnage” if the international community did not intervene.

A rebel spokesman confirmed that Misrata was under intense fire from pro-Gaddafi forces and reported casualties, but insisted the city was still in rebel hands, denying a state television report to the contrary.

But the rebels suffered a defeat at Bin Jawad, near Sirte, and fell back to Ras Lanuf. The rebels were attempting to move on Sirte, Gaddafi’s hometown and one of his strongholds.

Sirte is a coastal town in the centre of Libya and if it fell to the rebels it would be an enormous psychological blow to the Gaddafi side.

A former US envoy to the United Nations, Bill Richardson, said today it was time to “covertly arm the rebels” and enforce a no-fly zone over the north African country, to prevent Gaddafi using his air power against his own people.

The day began with machinegun fire that could be heard across the capital Tripoli but which the government claimed was “celebratory”.

Gaddafi’s troops sought to push opposition forces to the east to create a bigger buffer between them and Tripoli.

State television claimed that the regime had re-taken several key towns, including Tobruk in the east – a claim that was false.

It was unclear exactly who was winning the battles.

In Tripoli, Gaddafi supporters held a major rally that appeared designed to boost morale.

Fears of kidnapping of foreigners is also increasing – as much of the east, including Benghazi, is effectively closed and economic circumstances become more desperate, it is believed that criminal activities will increase.

Three Dutch commandos have been detained by the government after they, too, attempted to rescue expatriates.

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