Scores of civilians from President Bashar al-Assad's minority sect were reported killed Tuesday as Washington blacklisted an Al-Qaeda-linked rebel group it accuses of hijacking the uprising in Syria.
Bomb attacks in the village of Aqrab in the central province of Hama killed or wounded at least 125 civilians, said the Syrian Observatory for Human Rights, which could not immediately give a breakdown of the casualties.
"We cannot know whether the rebels were behind this attack, but if they were, this would be the largest-scale revenge attack against Alawites," members of a Shiite sect in Sunni-majority Syria, said Observatory director Rami Abdel Rahman.
Aqrab is located near Houla, a majority Sunni Muslim village where 108 people, including 49 children and 34 women, were massacred on May 25 in what was widely blamed on pro-regime militias despite denials from Damascus.
Reports of the latest massacre broke hours after the United States blacklisted Al-Nusra Front as a "terrorist organisation," balancing its move with the announcement of fresh sanctions against pro-Assad militias.
The US State Department said that despite its efforts to portray itself as part of the legitimate Syrian opposition, Al-Nusra was a front for the Al-Qaeda in Iraq (AQI) organisation.
"It is, in fact, an attempt by AQI to hijack the struggles of the Syrian people for its own malign purposes," it said.
The Al-Nusra Front's fighters, many of them jihadist volunteers from around the Islamic world, were instrumental in the fall of the army's massive Sheikh Suleiman base in northern Syria on Monday after a months-long siege.
Its role in the seizure of the garrison, the government's last between second city Aleppo and the Turkish border, undercut the military influence of the mainstream rebel Free Syrian Army (FSA).
An AFP journalist who witnessed the clashes around Sheikh Suleiman said many fighters were from other Arab countries and Central Asia.
The US Treasury Department designated two of the Al-Nusra Front's senior leaders, Maysar Ali Musa Abdallah al-Juburi and Anas Hasan Khattab, for sanctions.
It also imposed sanctions on two armed militias supporting the Assad regime as well as two shabiha (pro-regime militia) commanders.
At the same time, however, Washington said it had reason to ease the urgent concerns it had expressed in recent weeks about the dangers of Damascus resorting to use of its chemical weapons stockpiles against the rebels.
US Defence Secretary Leon Panetta said Syria had not taken any new steps in recent days that signal a readiness to use its arsenal.
"At this point the intelligence has really kind of levelled off. We haven't seen anything new indicating any aggressive steps to move forward in that way," Panetta told reporters aboard his plane before landing in Kuwait.
International military chiefs have met in London to discuss the Syria conflict, a diplomatic source said after a media report that they discussed plans to train rebels and give air and naval support.
A British diplomatic source confirmed that the military leaders had held talks, but played down the idea that they discussed military intervention against the Assad regime.
"As far as I know they didn't explore options in any detail, certainly they didn't explore options for military intervention," the diplomat said on condition of anonymity.
Inside Syria, at least 68 people were killed in violence across the country on Tuesday, the Observatory said, noting that its preliminary toll excluded the victims in Aqraba pending further reports.
With the total death toll now topping 42,000, according to the Observatory's figures, the UN High Commissioner for Refugees said the number of Syrian refugees in neighbouring countries and the wider Arab world had now passed half a million.
"And these numbers are currently climbing by more than 3,000 a day," UNHCR spokeswoman Melissa Fleming told reporters in Geneva.