A Libyan holds the country's old flag, which has been adopted by the rebels
Fighting raged in the long-besieged rebel-held Libyan city of Misrata where a human rights group charged the Libyan
army was using banned cluster munitions.
Heavy gunfire and shelling could be heard in Misrata, with sustained exchanges near the centre before nightfall, an AFP photographer reported. Air strikes also were reported near Sirte, the hometown of Libyan strongman Muammar Gaddafi..
The US-based Human Rights Watch (HRW) said its researchers reported the use of internationally banned cluster bomb munitions against the city.
Insurgents also said loyalist forces were using cluster bombs.
"Last night it was like rain," said Hazam Abu Zaid, a local resident who has taken up arms to defend his neighbourhood, describing the cluster bombings.
The use of the munitions was first reported by The New York Times. A reporting team for the daily photographed MAT-120 mortar rounds which explode in the air and scatter deadly, armour-piercing submunitions below.
"It's appalling that Libya is using this weapon, especially in a residential area," said Steve Goose, HRW's arms division director.
"They pose a huge risk to civilians, both during attacks because of their indiscriminate nature and afterward because of the still-dangerous unexploded duds scattered about," he said.
A spokesman for the Libyan regime denied the accusations.
"Absolutely no. We can't do this. Morally, legally we can't do this," government spokesman Moussa Ibrahim told journalists. "We never do it. We challenge them to prove it."
Misrata came under heavy attack Thursday by Gaddafi forces, who fired dozens of Grad missiles and tank shells that killed at least 13 people and wounded 50, a rebel spokesman said.
On Friday, the rebels said Gaddafii forces were firing shells and mortar rounds two kilometres (more than a mile) away from the main road, Tripoli Street.
Rebel checkpoints were seen around a now-abandoned residential area where nests of loyalist snipers were suspected to be active.
"We want NATO to attack Tripoli Street, there are no civilians there," pleaded one rebel.
Meanwhile, state news agency JANA said Kadhafi's hometown was targeted by NATO warplanes on Friday.
"Aggressor colonialist crusaders" launched air raids on Sirte, it said, adding that Al-Aziziya, south of Tripoli, was attacked again after state television reported raids there on Thursday evening.
And rebels fired off barrages of rockets from the edge of the eastern city of Ajdabiya as they advanced towards the key oil refinery town of Brega.
On the diplomatic front, the leaders of Britain, France and the United States said a Libyan future including Gaddafi is "unthinkable," while Russia charged that NATO was exceeding its UN mandate in Libya.
French Defence Minister Gerard Longuet said the United States, Britain and France are thinking beyond UN Security Council Resolution 1973 which authorises action to protect Libyan civilians and now seek regime change.
He admitted on LCI television the statement by the three leaders went beyond the terms of the current UN mandate.
"But I think that when three great powers say the same thing, it's important for the United Nations, and perhaps one day the Security Council will make another resolution," he added.
On Thursday, differences over Libya widened when the BRICS group Brazil, Russia, India, China and South Africa -- urged that "the use of force should be avoided."
Russian President Dmitry Medvedev went further, arguing that Resolution 1973 did not authorise military action of the kind being carried out by jets from NATO and some Arab countries.
Longuet dismissed this, arguing that Russia, China and Brazil "will naturally drag their feet.
"But which of the great countries can accept that a head of state can resolve his problems in training cannon fire on his own population? No great power can accept that."
In Berlin, Russian Foreign Minister Sergei Lavrov called for an urgent move towards a political settlement.
"We believe it is important to urgently transfer things into the political course and proceed with a political and diplomatic settlement," he said after talks with NATO foreign ministers.
"We should have an immediate ceasefire and bring the warring parties to the negotiating table so they can agree on the structure of their own country."
Resolution 1973 calls for a ceasefire, but Gaddafi has relentlessly pursued his campaign to retake territory lost to the rebels.
NATO Secretary General Anders Fogh Rasmussen denied that the air strikes were beyond the scope of the UN resolution.
"I have to stress that in the conduct of that operation, we do not go beyond the text or the spirit" of the resolution, he told a news conference.
Meanwhile, the European Union and NATO deepened their coordination for a potential EU military mission to deliver urgent humanitarian aid to Misrata, diplomats said.
Any EU mission would have to be coordinated with NATO because the 28-nation alliance has several warships and units of warplanes in the Mediterranean.
The International Organisation for Migration in Geneva said about 1,200 migrants stranded in Misrata have been evacuated, and are en route to Benghazi. Most were Bangladeshis and Egyptians, and included women, children and elderly.
In the key crossroads town of Ajdabiya, east of Misrata and on the front line between the rebel-held east and the mainly government-held west, rebels fired off barrages of rockets, an AFP reporter said.
A rebel convoy fitted with big guns and rocket launchers drove westwards past Ajdabiya to see if pro-regime forces had been rolled back by NATO the previous day.
They soon afterwards sent off volleys of rockets but received no return fire, leaving the whereabouts of Gaddafi's forces unknown.
Witnesses reported NATO air strikes on pro-Gaddafi armour in the Zintan region of western Libya, amid clashes with rebels who hold several areas and rebel reports that Gaddafii troops were trying to cut the road to nearby Yafran.
Rebels said they had lost eight fighters and that another 11 were wounded, and that they had taken several prisoners.
"There were air strikes on tanks of Gaddafi loyalists a dozen or so kilometres (seven miles) from Zintan," a town of 40,000 people around 150 kilometres (93 miles) southwest of Tripoli, one witness told AFP.
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