Updated 1:11 p.m. ET
RAS LANOUF, Libya - Government forces drove hundreds of rebels from a strategic oil port with a withering rain of rockets and tank shells on Thursday, significantly expanding Muammar Qaddafi's control of Libya as Western nations struggled to find a way to stop him.
France became the first country to recognize the rebels' governing council, and an ally of President Nicolas Sarkozy said his government was planning "targeted operations" to defend civilians if the international community approves.
The Obama administration said it was suspending relations with the Libyan embassy in Washington and Secretary of State Hillary Rodham Clinton said she would meet with opposition leaders in the U.S., Egypt and Tunisia.
But there was no concrete sign of Western moves toward military assistance such as the no-fly zone that the rebels pleaded for as they retreated through the pancake-flat desert scrubland outside the port of Ras Lanouf, scanning the skies for government warplanes.
U.S. Defense Secretary Robert Gates said that while the NATO alliance will pursue planning for a possible no-fly zone over Libya it is not ready to act on that or any other military action against the North African nation. Gates made clear that NATO is not interested in direct military intervention in Libya unless the U.N. Security Council passes a further resolution granting such authority.
The fleeing rebels said government forces showered rockets and tank shells on Ras Lanouf in preparation for a full-scale advance. Lightly armed opposition members sped back to their territory by the hundreds, fleeing eastward in cars and pickup trucks mounted with machine guns.
A rebel official in the town of Ajdabiya inside opposition territory said Qaddafi's troops and tanks were battling the insurgents at the western entrance to Ras Lanouf and using gunboats to fire on the rebels from the sea.
"These are tough battles," said Akram al-Zwei, a member of the post-uprising town committee. "We are fighting against four battalions heavily equipped with airpower, tanks, missiles, everything."
He added that the rebels are fighting alongside the Saaiqa 36 Battalion, which had been based in Benghazi but defected to the opposition.
Taking back Ras Lanouf would be a major victory for Qaddafi, reestablishing his power over a badly damaged but vital oil facility and pushing his zone of control further along the main coastal highway running from rebel territory to the capital, Tripoli.
A rebel governing council spokesman said Qaddafi's air force, army and navy had bombarded Ras Lanouf, targeting the main hospital, mosques and civilian areas.
"The regime that has lost legitimacy is practicing a scorched earth policy," spokesman Abdel-Hafidh Ghoga said. "We have requested for all steps to be taken to protect the Libyan people. We believe the U.N. can do that."
Amid the recent gains by Qaddafi forces, U.S. Director of National Intelligence James R. Clapper told lawmakers Thursday that the regimeover the rebels.
"With respect to the rebels in Libya and whether or not they will succeed or not, I think frankly they're in for a tough row," he said.
CBS News correspondent Mark Phillips reports that government fighter jets also struck a rebel-held oil facility in the town of Brega Thursday morning, dropping bombs on the part of the country's vital infrastructure.
The rebel hospital in Brega said four were confirmed dead in the fighting, 35 were wounded and 65 were missing.
The international Red Cross said dozens of civilians have been wounded or killed in recent days in grueling battles between Qaddafi's army and the opposition.
"We need help from the international community, but we just hear promises," said Mohammed Ali Al Zuaiee, a 48-year-old rebel fighter. "They are doing nothing."
The main hospital in Ras Lanouf was hit by artillery or an airstrike and the rebels are pulling their staff out and evacuating patients to the towns of Brega and Ajdabiya, said Gebril Hewada, a doctor on the opposition's health committee in the main eastern city of Benghazi.
Phillips described the rebels in the country's east as, "a beleaguered force, and they are being pounded right now by superior armaments," explaining in part the urgent calls from their supporters for an internationally enforced no-fly zone.
France said it planned to exchange ambassadors with the rebels' Interim Governing Council after Sarkozy met with two representatives of the group based in the eastern Libyan city of Benghazi.
"It breaks the ice," said Mustafa Gheriani, an opposition spokesman. "We expect Italy to do it, and we expect England to do it."
French activist-intellectual Bernard Henri-Levy sat in the meeting and said France was planning "targeted operations" to defend civilians if the interim council demands them and the international community approves. Henri-Levy did not elaborate and the French government declined to comment, so it was not clear if Henri-Levy was describing a new, more aggressive plan for intervention.
NATO said it had started round-the-clock surveillance of the air space over Libya, and British Foreign Secretary William Hague said a meeting of EU foreign ministers would discuss how to isolate the regime.
Germany said it froze billions in assets of the Libyan Central Bank and other state-run agencies. The U.S., UK, Switzerland, Austria and other countries have also frozen Qaddafi's assets.
"The brutal suppression of the Libyan freedom movement can now no longer be financed from funds that are in German banks," Economy Minister Rainer Bruederle said.
The Libyan government tried to stave off tough action, sending envoys to Egypt, Portugal and Greece. But in the face of continued international opposition, Qaddafi's son, Saif al-Islam Qaddafi, said the regime isn't "afraid of Americans, NATO, France, Europe" and the loyalists would "never ever surrender to those terrorists."
In the west, Qaddafi claimed victory in recapturing Zawiya, the city closest to the capital that had fallen into opposition hands. Western journalists based in Tripoli were taken late Wednesday to a stadium on the outskirts of Zawiya that was filled with Qaddafi loyalists waving green flags and launching fireworks. Libyan TV cameras filmed the celebrations as food, drinks and cooking oil were distributed.
Government escorts refused journalists' requests to visit the city's main square.; phone lines there have not been working during a deadly, six-day siege.
Red Cross President Jakob Kellenberger said local doctors over the past few days saw a sharp increase in casualties arriving at hospitals in Ajdabiya, in the rebel-held east, and Misrata, in government territory.
Both places saw heavy fighting and air strikes, he said.
Kellenberger said 40 patients were treated for serious injuries in Misrata and 22 dead were taken there.
He said the Red Cross surgical team in Ajdabiya operated on 55 wounded over the past week and "civilians are bearing the brunt of the violence."
He said the aid organization is cut off from access in western areas including Tripoli but believes those are "even more severely affected by the fighting" than eastern rebel-held territories.
Meanwhile, a correspondent for British newspaper the Guardian and a Brazilian journalist traveling with him been detained by government authorities in western Libya, the press freedom group Reporters Without Borders said Thursday.
Guardian correspondent Ghaith Abdul-Ahad, an Iraqi, was last in touch through a third party Sunday, when he was on the outskirts of Zawiya, a city west of Libya's capital that has seen battles in recent days, Middle East Editor Ian Black said.
Brazilian newspaper O Estado de S. Paulo reported that it lost direct contact a week ago with its correspondent, Andrei Netto, who was covering the unrest in Libya.
A Libyan guide was traveling with the pair. It was not immediately clear whether the guide was also detained or where the men were being held.
The men were detained by pro-Qaddafi forces while covering the clashes in the Zawiya area and are still being held, Reporters Without Borders said in a written statement condemning the arrests.
"Journalists should not under any circumstances be made to pay for the fighting between government forces and rebels," the group said, adding that it condemns the treatment of three BBC journalists who were beaten and subjected to mock executions by Libyan authorities in the same area this week. The BBC employees were later released.
The British Broadcasting Corp. staff said three of its staff were detained, beaten and subjected to mock executions by pro-regime soldiers in Libya while attempting to reach the western city of Zawiya.
The news organization said the crew, members of a BBC Arabic team, were detained on Monday by Qaddafi loyalists at a check point about 6 miles south of Zawiya.
Chris Cobb-Smith, a British journalist and part of the crew, said the group were moved between several locations, in some cases alongside civilian captives who had visible injuries from heavy beatings.
Libyan TV on Tuesday played audio of what it said was a telephone conversation in Arabic and English between U.S. ambassador Gene Cretz and Omar Hariri, rebel council leader, in which the two discuss the areas under opposition control. The authenticity of the recording could not be immediately verified.