Rebels defending the key Libyan town of Ajdabiya braced for new attacks from forces loyal to strongman Muammar Gaddafi Tuesday with little prospect of foreign air protection any time soon.

Elsewhere in the troubled region tension mounted in Bahrain following the entry of forces from other Gulf states to help the Sunni-minority regime deal with mass demonstrations for reform led by the strategic kingdom's Shiite majority.

Officials said countries in the powerful Group of Eight and at the United Nations Security Council remained split over the merits of imposing a no-fly zone over Libya to prevent government air strikes.

But US Secretary of State Hillary Clinton held out the possibility of economic and political aid to the Libyan opposition at a meeting with one of the rebel leaders in Paris, US officials said.

Pro-Gaddafi forces staged a brief bombardment targeting Ajdabiya Monday which medics said left five people wounded but there was no sign that ground troops were resuming their eastward advance.

The lightly armed rebels have been pushed back some 200 kilometres (125 miles) by Gaddafi's better equipped forces in the past week.

They are now only 170 kilometres from the rebel capital of Benghazi, Libya's second city with a population of around one million.

Ajdabiya guards vital roads north to Benghazi and east to the oil port of Tobruk, giving the insurgents control of eastern Libya up to the Egyptian border.

Gaddafi said the rebellion against his rule was a "lost cause", in an interview with Italian daily Il Giornale published on Tuesday.

The rebels "have no hope, it's now a lost cause for them," Gaddafi said.

The rebels have "two choices: surrender or flee," he said, adding: "These terrorists are using civilians as human shields including women.

"If they surrender we will not kill them," he continued.

French Foreign Minister Alain Juppe said Tuesday the Group of Eight powers are still divided over military intervention being pushed for by France and Britain.

"For the moment I have not convinced them," Juppe told Europe 1 radio, referring to his talks with counterparts from Britain, Canada, Germany, Italy, Japan, Russia and the United States which began Monday night.

A senior US official said in Paris late Monday there was a "sense of urgency" about the humanitarian and political situation in Libya at a dinner attended by the foreign ministers.

But the consensus was to take the no-fly zone issue to the Security Council "for a full and public discussion of what all of the measures that have been discussed entail," the official said.

Some ministers alluded to no-fly zones, some mentioned "safety zones," while others talked of further sanctions, he added.

The goal they all backed was to "increase pressure" on Gaddafi's regime and "to stop the regime from using force" against the Libyan people, the official said.

At the Security Council on Monday, European and Arab envoys emphasised the need for urgent UN action, but diplomats said it could be several days before any measures are agreed.

Britain and France have a draft no-fly zone resolution for the council and have been boosted by Arab League support. China is opposed, as is India, while the United States, Germany and others have doubts, none stronger than Russia.

Moscow's UN envoy Vitaly Churkin said crucial questions had not been answered, while stressing that Russia was "open-minded" about no-fly zones and other proposals to end the violence.

"If there is a no-fly zone, who is going to implement the no-fly zone? How is the no-fly zone going to be implemented?" he asked.

"We have not had enough information. To say 'we need to act quickly,' 'as fast as possible' but not to provide the fundamental answers to those fundamental questions, to us is not really helping."

US officials said Clinton had gone beyond offering humanitarian aid but stopped short of promising military help in the highest-level talks yet between Washington and the opposition.

Aid could be political or economic or even include "certain forms of equipment," one senior official said.

The chief US diplomat met with Mahmoud Jibril, who handles foreign affairs for Libya's transitional national council based in Benghazi.

"They had a private and candid conversation about ways in which the United States can assist the Libyan people in their efforts against the Gaddafi regime," top Clinton aide Philippe Reines told reporters.

The senior official said Jibril told Clinton his group aimed to include Libyans from both east and west parts of Libya, but to ensure their safety could not name those in the west, where Gaddafi has a stronger power base.

Jibril had asked the United States for combat material, the official said, adding that Clinton replied she would consider it, but made no commitments.

The US government has also appointed a representative to the rebel council in line with a pledge by President Barack Obama, officials said, while not disclosing his name publicly, also apparently for security reasons.

"The intention is for him to go to Benghazi," a senior official said.

The European Union has also sent a fact-finding mission to Benghazi to look at all options, including an air exclusion zone, a spokeswoman said Monday.

In Tripoli UN envoy Abdul Ilah Khatib urged an end to the violence in Libya and access for humanitarian relief efforts, in talks with Foreign Minister Mussa Kussa.

Khatib "called for cooperation from the authorities on human rights and humanitarian concerns," UN deputy spokesman Farhan Haq said from New York.

Senior Libyan officials had assured him "the government would fully cooperate" with an inquiry commission into the Libyan revolt set up by the UN Human Rights Council.

In Bahrain the intervention of Saudi-led forces caused alarm Tuesday, with Shiite theocracy Iran calling it "unacceptable" and likely to complicate the already volatile situation there.

A spokesman for UN chief Ban Ki-moon said he was "troubled" by the violence in Bahrain and noted the foreign intervention "with concern."

The United States, whose Fifth Fleet is based in Bahrain, has urged restraint on all sides but has not called for the foreign forces to withdraw.