A European Union crisis summit on Libya opened in Brussels on Friday with countries divided over a British-French push to prepare for military action and formal recognition of Muammar Gaddafi's opponents.

Capping 48 hours of talks on Libya involving NATO defence ministers and EU foreign ministers, heads of state and government of the 27-nation bloc were meeting to deliver a joint response on events in the oil-rich country.

British Prime Minister David Cameron and French President Nicolas Sarkozy went into the talks urging partners to extend formal recognition to Libya's opposition while working on contingency planning for military action.

"We are going to step up today measures in the European Council (summit) to put pressure on that regime, measures to isolate that regime," Cameron said.

"We should also plan for every eventuality," he said. "This is absolutely vital."

Britain and France have a draft resolution in hand to put to the United Nations Security Council for an air exclusion zone over the oil-rich country. But the council remains split on the issue and even allies Germany and Italy have sounded words of warning.

Ratcheting up the pressure on Tripoli, Sarkozy said Paris and London favoured targeted strikes in Libya in case Gaddafi uses chemical weapons or air power against his people.

Sarkozy said Paris had "many reservations" on military or NATO intervention in Libya "because Arab revolutions belong to Arabs."

But he and Cameron were "ready, on condition that the UN wishes, that the Arab League accepts and that the Libyan opposition, which we hope to see recognised, agrees, for targeted actions if Mr Gaddafi uses chemical weapons or air power against peaceful citizens".

Sarkozy also called on his European partners to follow France's lead and officially recognise the opposition against Libyan leader Muammar Gaddafi.