Libyan leader Muammar Gaddafi signalled his defiance in the face of a mounting revolt against his 41-year rule on Tuesday, making a brief appearance on state television and denying he had fled the country.

His forces have cracked down fiercely on anti-government demonstrators, with fighting now spreading to the capital Tripoli after erupting in Libya's oil-producing east last week.

In his first appearance on television since the revolt broke out, Gaddafi was shown holding an umbrella in a 22-second statement. He denied reports that he had fled to Venezuela, ruled by his friend President Hugo Chavez.

"I want to show that I'm in Tripoli and not in Venezuela. Do not believe the channels belonging to stray dogs," said Gaddafi, leaning out of a van in front of his house.

"I wanted to say something to the youths at Green Square (in Tripoli) and stay up late with them but it started raining. Thank God, it's a good thing," added Gaddafi, who took power in a military coup in 1969 when he toppled King Idriss.

Security forces have killed dozens of protesters across the vast, thinly populated nation stretching from the Mediterranean deep into the Sahara desert, human rights groups and witnesses said, prompting widespread condemnation from world leaders.

Demonstrations spread to Tripoli after several cities in the east - including Benghazi where the protests had first erupted - appeared to fall to the opposition, according to residents.

Cracks were beginning to appear among Gaddafi's supporters, with a group of army officers calling on soldiers to "join the people" and two senior fighter pilots defecting to nearby Malta.

The UN Security Council will hold a closed-door meeting on Tuesday to discuss the crisis, diplomats said.

Tripoli, a Mediterranean coastal city, appeared calm in the early hours of Tuesday. "There is heavy rain at the moment, so people are at home," one resident said. "I am in the east of the city and have not heard clashes."

Residents had earlier reported gunfire in parts of Tripoli and one political activist said warplanes had bombed the city.

"What we are witnessing today is unimaginable. Warplanes and helicopters are indiscriminately bombing one area after another. There are many, many dead," Adel Mohamed Saleh said in a live broadcast on al Jazeera television.

Residents said queues of anxious shoppers trying to stock up on food and drink had formed outside stores. Some shops were closed.

Oil prices have soared on worries over instability in the Opec member. Ninety per cent of Libya's oil exports come from the eastern region of Cyrenaica, epicentre of the revolt.

International Energy Agency (IEA) chief economist Fatih Birol said on Tuesday that oil prices were in the danger zone and could rise higher if turmoil persisted in the Middle East.

Upheavals which deposed the presidents of Tunisia and Egypt have shaken the Arab world and inspired protests across the Middle East and North Africa, threatening the grip of long-entrenched autocratic leaders.

US-based Human Rights Watch said at least 233 people had been killed in five days of violence in Libya. Opposition groups put the figure much higher. No independent verification was available and communications from outside was difficult.-Reuters