Yemen's army has recaptured a southern provincial capital held by Islamist militants since May, the state news agency said on Saturday, citing the provincial governor and military officials.

The army launched an offensive two months ago against the militants controlling the coastal city of Zinjibar, which lies east of a strategic shipping strait through which some 3 million barrels of oil pass daily.

Militants with suspected links to al Qaeda have seized swathes of territory in the southern province of Abyan, taking advantage of turmoil in a country convulsed for months by protests against President Ali Abdullah Saleh's 33-year rule.

Just last week, militants took another town in Abyan despite the army campaign backed by air strikes and heavy weapons.

A military official said earlier on Saturday the army had broken a four-month siege of a brigade based near Zinjibar by fighters said to be from al Qaeda's Yemen-based wing.

He said many militants had fled towards Jaar, another town they control in Abyan, adding that three were killed in clashes in and around Zinjibar and four soldiers were wounded.

The 25th brigade was surrounded in May, when the militants took over Zinjibar, a few km from its barracks.

'We are pursuing limited pockets of militants, but the real battle will be to cleanse the town of Jaar,' said General Mohammad al-Somali.

President Saleh, recovering in neighbouring Saudi Arabia from a June assassination attempt, congratulated the army on its what he called its victory against the militants.

The United States and Saudi Arabia fear lawlessness and political chaos in Yemen will give al Qaeda in the Arabian Peninsula more room to launch attacks in the region and beyond.

Saleh's opponents accuse him of exaggerating the threat of al Qaeda and even encouraging militancy to scare Washington and Riyadh into backing him.-Reuters