Updated at 6:40 p.m. ET
BREGA, Libya - Rebels strengthened their hold on the strategic oil installation at Brega on Thursday after repelling an attempt by loyalists of Muammar Qaddafi to retake it. International pressure on the Libyan leader increased as an international court began investigating whether to charge him and his inner circle with crimes against humanity.
Meanwhile, President Barack Obama insisted Thursday that Qaddafi "step down from power and leave," his most explicit statement of support for rebels challenging the Libyan leader's four-decade rule in a region convulsed by uprisings against authoritarian regimes.
Army units allied with the rebels fanned out in the oil facilities and port at Brega, armed with machine guns and rocket launchers. Government warplanes launched a new airstrike on the town in the morning, reports CBS News correspondent Mandy Clark.
In Tripoli, Saif Qaddafi, son of Libya's dictator, confirmed Brega had been bombed but offered a strange rationale. The attack was intended just to scare off the rebels not to kill them. And he gave a chilling assessment of just how vital this place is.
"Nobody will allow the militia to control Brega," the younger Qaddafi said. "Excuse me. It's like you allowing someone to control uh Rotterdam Harbor in Holland."
At the scene of the bombing, militia commander Abdul Rahman showed CBS News three huge craters, a short distance from a rebel checkpoint at the entrance of the oil terminal.
"This refinery is more important than any other place in Libya," Rahman said.
He agreed with Qaddafi's assessment. This terminal can pump 55 thousand barrels of oil to supertankers each day. That's why he believes the dictator will strike here again.There were no reports of casualties from the bombing, and pro-Qaddafi forces had withdrawn to another oil port, Ras Lanouf, 80 miles west along the Mediterranean coast after their defeat a day earlier.
"We are in a position to control the area and we are deploying our forces," a rebel army officer in Brega told The Associated Press, speaking on condition of anonymity because he was not authorized to talk to the media.
Although there have been stirrings of a diplomatic effort to ease the crisis, an opposition spokesman flatly ruled out any negotiations with Qaddafi, saying "his hands are tainted with blood."
Signaling he was digging in, Qaddafi's regime apparently has stepped up its recruitment of mercenaries from other African countries, with an official in neighboring Mali saying that 200-300 men have left for Libya in the last week.
In the opposition stronghold of Benghazi, east of the oil port, hundreds of mourners chanted "Down with Qaddafi" as they buried three of the at least 14 rebel fighters killed in Wednesday's battle.
"Our message to Qaddafi is we are coming and we will make Libya free," said one man in the crowd, Sami Mosur. "He is a criminal we are coming from to him from Benghazi, we are coming from everywhere. He is a killer."
The fighting at Brega halted for now the regime's first counteroffensive on the opposition-held eastern half of the country. It also underlined the deadlock that Libya appears to have fallen into more than two weeks into its upheaval.
A distraught man at Brega's hospital told CBS News that among those waging the pro-Qaddafi offensive on Wednesday were "mercenaries from Africa" -- not the firsts time the Libyan ruler has been accused of using paid killers to attack his own people in recent days.
But Qaddafi's forces seem unable to bring significant strength to dislodge rebels from the territory they hold. But the opposition does not have the capability to go on the offense against Qaddafi's strongholds in the west, including the capital.
Qaddafi's regime has unleashed the bloodiest crackdown of any Arab nation to the wave of anti-government protests in the region. Hundreds are known to have been killed, and some estimates top 1,000.
In Libya's capital, Tripoli, residents live in a constant state of fear. Residents say they are under the watchful eyes of a variety of Qaddafi militias prowling the streets. They go under numerous names - Internal Security, the Central Support Force, the People's Force, the People's Guards and the Brigade of Mohammed al-Magarif, the head of Qaddafi's personal guard - and they are all searching for suspected protesters.
"While you are speaking to me now, there are spies everywhere and people watching me and you," one man said, cutting short a conversation with an Associated Press reporter visiting the Tripoli district of Zawiyat al-Dahman on Thursday.
Residents said calls for new protests to be held Friday after weekly Muslim prayers were being passed by word of mouth in several districts of the capital.
Whether crowds turn out will depend on the depth of fear among Gadhafi opponents. Friday could prove a test of the extent of Gadhafi's control. The capital is crucial to the Libyan leader, his strongest remaining bastion after the uprising that began on Feb. 15 broke the entire eastern half of Libya out of his control and even swept over some cities in the west near Tripoli.
In the Netherlands, the top prosecutor at the Hague-based International Criminal Court said Thursday he would investigate Qaddafi and his inner circle, including some of his sons, for possible crimes against humanity in the violent crackdown on anti-government protesters.
Luis Moreno-Ocampo said Qaddafi and several commanders and regime officials had formal or de facto control over forces that attacked protesters. There will be "no impunity in Libya," he vowed. Besides Qaddafi, he specified the titles of seven others to be investigated, including the commander of the 32 battalion, the head of Qaddafi's personal security, the national security adviser and several other security chiefs. Qaddafi's son Khamis commands the elite 32nd battalion and another son, Muatassim, is the national security adviser.
Opposition leaders are pleading for foreign powers to launch airstrikes to help them oust Qaddafi as the United States moves military forces closer to Libyan shores to put military muscle behind Washington's calls for Qaddafi to give up power immediately.
But the Pentagon on Wednesday tried to downplay the idea of using military force in Libya, including a "no-fly zone" that Defense Secretary Robert Gates said would first require attacking Qaddafi's government.
"Let's just call a spade a spade: A no-fly zone begins with an attack on Libya to destroy the air defenses," Gates told lawmakers. He added that the operation would require more warplanes than are on a single U.S. aircraft carrier.
Pentagon officials confirmed to CBS News that Qaddafi's air force flew some tactical missions on Wednesday but said indications were they targeted opposition forces, not civilians. That doesn't mean the Pentagon condones the strikes, reported CBS News national security correspondent David Martin, but it does lower the outrage factor -- and since the still-pending decision by the U.S. on whether to set up a no-fly zone is a political one, the outrage factor counts.
Asked Thursday by "The Early Show" co-anchor Erica Hill about the likelihood of a direct U.S. military intervention in Libya, former NATO commander Gen. Wesley Clark said the best option for Mr. Obama's government was to "go ahead and work through the diplomatic channels" available, rather than make any unilateral decisions.
Any intervention or no-fly zone would have to first be authorized by a United Nation's resolution to be accepted by the international community, said Clark
"The real risks are not to our fliers, but what's down the road," said Clark, asking rhetorically, "If his (Qaddafi's) forces succeed on the ground, what's the next step?"
Italy's foreign minister on Thursday ruled out any military action by his country, citing Italy's history as a colonial occupier of Libya.
Qaddafi on Wednesday warned the U.S. and other Western powers not to intervene. "Thousands of Libyans will die" if the West does so. "We will distribute arms to 2 or 3 millions and we will turn Libya into another Vietnam." He warned that any foreign troops coming into Libya "will be entering hell and they will drown in blood."
There have been stirrings of a diplomatic effort. Qaddafi's ally Venezuelan President Hugo Chavez proposed that his country and a bloc of "friendly" nations mediate between the Libyan leader and the opposition.
Oil prices eased below $102 a barrel Thursday on profit taking and hopes that the conflict in Libya might be resolved by international mediation.
But so far there's been no response from Qaddafi or the rebels to the mediation idea. The head of the Cairo-based Arab League - also contacted by Chavez on the proposal - seemed cool on the offer. League spokesman, Hisham Youssef, said the idea was still not clearly drawn out and added that any mediation must "take into consideration the aspirations of the Libyan people" - an apparent reference to those who joined the uprising.
At Brega, army units that have joined the opposition moved in to keep security after Wednesday's battle, waged by citizen militias from nearby towns and cities. Despite having little central organization or command, the rag-tag anti-Qaddafi fighters - armed with automatic weapons and some heavy machine guns and rocket launchers - was able to repel a force of several hundred regime troops that attacked after dawn.
Farj Lashrash, a soldier with the opposition, said the rebel fighters had captured 10 pro-Qaddafi soldiers since last night.
The troops came in from the opposition stronghold of Benghazi, 140 miles northeast of Brega. Dozens of the rebel forces, armed with Kalashnikov rifles and dressed in camouflage army uniforms with checkered keffiyehs around their necks or heads fanned out around Brega, which has a port, airstrip, oil installation and a small town. They were backed by at least a dozen pickup trucks with machine-guns bolted onto their beds or rocket launchers in tow.
There was no sign of any pro-Qaddafi forces around Brega. Aside from the airstrike, the area was calm. No casualties from the airstrike were reported, but a few rebel fighters were rushed to the hospital with wounds after a mortar they were handling exploded.
In the nearby rebel-held town of Ajdabiya, which sent fighters to the battle, morgue officials said the death toll from the Brega fighting rose to 14 from at least 10 a day earlier. The western gate of the town was reinforced with heavy weaponry as defense against any attack - including a tank, four anti-aircraft guns mounted on pickup trucks and four rocket launchers.
Brega is the second-largest petroleum and natural gas facility in OPEC-member Libya and has been held by the opposition since last week.
Amid the chaos sweeping the country, exports from the country with Africa's largest proven oil reserves have all but stopped. Crude production in the southeastern oil fields that feed the facility at Brega has been scaled back because storage facilities there are filling up.
The uprising has sent world oil prices spiking to the highest levels in more than two years, above $100 per barrel. Overall, Libyan crude production has dropped from 1.6 million barrels per day, nearly 2 percent of world consumption, to as little as 600,000 barrels per day.
"In the last 24 hours, we had a bit of a panic here," oil company employee Osman Rajab told the AP. "Now they (the rebel army) are trying to control the industrial areas," he said, referring to the oil complex.
At the edge of Brega's massive oil facility, the rebel army set up a line of defense, with soldiers, four pickup trucks mounted with machine guns and one truck towing a rocket launcher.
For the past week, pro-Qaddafi forces have been focusing on the west, securing Tripoli and trying to take back nearby rebel-held cities. But the regime has seemed to struggle to bring an overwhelming force to bear against cities largely defended by local residents using weapons looted from storehouses and backed by allied army units.
Pro-Qaddafi forces succeeded over the weekend in retaking two small towns. But the major western rebel-held cities of Zawiya and Misrata, near Tripoli, have repelled repeated, major attacks - including new forays against Zawiya on Wednesday.
Zawiya was quiet Thursday, and residents have set up defenses at the city entrances, said resident Alaa al-Zawi, an opposition activist. "Our information is that there is a big (pro-Qaddafi) force amassed on the eastern side of the city," he said. "There might be an attack but we are ready to repulse it."
He said the city has enough food and water to last up to six months, though the worry is lack of medicine if fighting resumes.
The turmoil in Libya has set off a massive exodus of 180,000 people - mostly foreign workers in Libya - who have fled to the borders, U.N. refugee agency spokeswoman Melissa Fleming told the AP.