Rebels reject Gaddafi offer - report 
Reuters
BATTLE: Heavily armed rebels clashed with forces loyal to Muammar Gaddafi on Friday on the outskirts of the key oil terminal of Ras Lanuf.
World news
Nato weighing military options in Libya crisis - Obama Chirac on trial in misuse of funds caseLava spews after Hawaiian crater collapse LATEST: Al Jazeera television said Libyan rebels on Monday rejected an offer by Muammar Gaddafi to hold a meeting of parliament to work out a deal under which he would step down.
Al Jazeera said sources from the rebel interim council told its correspondent in Benghazi that the offer was rejected because it would have amounted to an "honourable" exit for Gaddafi and would offend his victims.
Al Jazeera said Gaddafi wanted guarantees of personal safety for him and his family and a pledge that they not be put on trial. It said that Gaddafi had sent former prime minister Jadallah Azzouz Talhi to meet the rebels and offer to hold a meeting of the General People's Congress to work out the details of such a deal.
The offer aimed at having Gaddafi hand over power to a committee formed by the General People's Congress, the television said.
It said Gaddafi proposed the meeting of the General People's Congress, or parliament, to the interim council based in the rebel-controlled city of Benghazi.
ASSAULT ON REBELS
Earlier today Britain and France said they were seeking UN authority for a no-fly zone over Libya, as Gaddafi's warplanes counter-attacked against rebels and aid officials said a million people were in need.
Rebels swiftly rejected an olive branch offered by an associate of Gaddafi, and fighting escalated around one of the country's key oil ports. The ageing autocrat warned that if he fell thousands of refugees would "invade Europe."
With civilians surrounded by forces loyal to Gaddafi in two towns, Misrata and Zawiyah, in the western part of Libya, fears were growing of a rising humanitarian crisis inside the country if the fighting was not stopped.
"We are working closely with partners on a contingency basis on elements of a resolution on a no-fly zone, making clear the need for regional support, a clear trigger for such a resolution and an appropriate legal basis," British Foreign Secretary William Hague said early today (NZ time).
A French diplomatic source said France was "working with our partners in New York on a no-fly zone resolution."
UN Defence Secretary Robert Gates, visiting Afghanistan where foreign forces have been fighting for a decade, cautioned any action in Libya "should be the result of international sanction." The White House said all options were on the table, including arming rebels.
Russia, a key permanent member of the UN Security Council with veto powers, said it opposed foreign military intervention. "The Libyans have to solve their problems by themselves," Foreign Minister Sergei Lavrov said.
Nato Secretary-General Anders Fogh
