Forces loyal to Libyan leader Muammar Gaddafi have reportedly defeated rebels in the coastal town of Zuwarah, retaking one of the last rebel-held towns in western Libya, according to residents.
"Zuwarah is in their hands now," Tarek Abdallah said on Monday. "They control it and there is no sign of the rebels. They are now in the centre - the army and the tanks."
"The fighting stopped and they are here," he told Reuters. "We don't know what will happen to us and we fear they might commit crimes. We hope and pray to God they don't."
Troops loyal to Gaddafi launched their attack in the morning, closing in from west, east and south and fighting their way into what had been a relatively quiet town since the insurrection against the long-time leader began last month.
Rebels in the town had said they were poorly equipped and doubted they could hold it very long. In the end, they were
beaten within a few hours.
The only main town still held by rebels in the west, where Gaddafi has his power base, is Misurata, 200km east
of the capital and Gaddafi stronghold, Tripoli.
Zuwarah stands 120km west of Tripoli and near the border with Tunisia.
Meanwhile, also on Monday, Gaddafi's warplanes bombed the rebel-held eastern city of Ajdabiya, one of two major
population centres between government forces and the rebel headquarters of Benghazi.
Said Ali Bouhilfaya, a resident of Ajdabiya, said there are airstrikes every 20 minutes after a brief lull during the day.
The bombings came hours after a rebel spokesman said a government plane dropped pamphlets over the city, asking residents to get rid of anti-Gaddafi forces.
"Cut off their water and their food!'' the pamphlets said, according to rebel spokesman Abdul-Bari Zwei.
Rebels said there had been no casualties, but the attack on Ajdabiya is seen, from the rebels' viewpoint, "as the last line of defence," said Al Jazeera's Tony Birtley, reporting from Benghazi.
"Gaddafi forces are advancing and it seems that fighting is carrying on and coming close to Benghazi," he said.
"It seems like we are entering the final phase of the conflict but whether this revolution will fail or succeed, that will only be determined in the coming weeks."
Soliman Bouchuiguir, president of the Libyan League for Human Rights speaking in Geneva, warned of a "bloodbath... a massacre like Rwanda" if Gaddafi's heavily armed forces broke through to attack Benghazi.
Meanwhile, Gaddafi offered an amnesty to rebel fighters if they agreed to lay down their arms, Libyan state television reported on Monday.
Al Jazeera's correspondent in Tripoli said the offer will play on very anxious rebel forces who don't know how they will be able to put up a fight against Gaddafi's forces, given the overwhelming superiority of his military forces.
"There is an enormous degree of anxiety. It's an all-or-nothing game now," Anita McNaught said.
"If the rebels do not manage to hold out against Gaddafi and establish some kind of protective zone in the east of the country, it is almost certain in the wake of this there would be some dreadful purge of those who dared to raise their hands against the Gaddafi administration.
"People know that unless they are able to keep Tripoli at bay, that the alternative is almost too awful to contemplate. Those fears apply equally in Tripoli; they are just not expressed as openly as they are in the east."
On the battlefield, rebel fighters say they have re-taken parts of the oil town of Brega and captured and even killed Gaddafi troops - but government forces contest that claim, saying that they are in control of the town.
On Monday, about 2,000 rebel fighters, mainly members of a special commando unit that defected to the opposition, held Brega's residential district, while pro-Gadhafi troops controlled the industrial oil facilities some distance away, said rebel spokesman Abdul-Bari Zwei.
He said rebel fighters were searching the residential area for any remaining Gadhafi troops. Libyan state TV showed some images on Monday from Brega port, claiming that it was in government control and at peace.
Gaddafi forces are trying to push back the long stretch of territory controlled by rebels - nearly the entire eastern half of the country, which also has most of Libya's oil.
The lightly-armed rebels have been pushed back some 200km by Gaddafi's superior military in the past week. His forces have also stamped out a rebellion in the eastern oil town of Ras Lanuf.