UN-sponsored Yemeni peace talks in Switzerland appeared to be struggling amid differences over government demands for the release of senior officials held by the Iran-allied Houthis, sources close to the talks said on Thursday.

The dispute comes amid fresh fighting between the Houthis and forces loyal to the Saudi-backed President Abd-Rabbu Mansour Hadi in which at least 15 people were killed from both sides, according to tribal and medical sources.

Brigadier General Ahmed al-Assiri of the Saudi coalition said the Iran-allied Houthis had repeatedly broken the ceasefire supposed to begin at midday on Tuesday and that his forces were responding.

Peace talks began on Tuesday away from television cameras in Switzerland to try to end nearly nine months of fighting that has killed almost 6,000 people and displaced millions.

The sources said that direct talks between the two sides have been suspended since Wednesday evening, after the Houthis rejected demands to free senior officials, including Defence Minister Mahmoud al-Subaihi and Hadi's brother, Nasser.

Both Subaihi and Nasser Mansour Hadi, who was responsible for intelligence operations in the provinces of Aden, Lahej and Abyan, have been held by the Houthis since March.

The Houthis say they are ready to free the prisoners once a permanent ceasefire was agreed upon, another source close to the talks told Reuters.

The truce was intended to last seven days and coincide with the peace talks to try to end a nine-month-old civil war between the Houthis based in Yemen's north and Saudi-backed southern and eastern fighters loyal to President Abd-Rabbu Mansour Hadi.

Nearly 6,000 people have been killed in the fighting and millions displaced.

"The number of violations is around 150 and this does not show honest intentions," Assiri told al-Ekhbariya television on Wednesday.

"We urge the United Nations to clarify to the Houthis that there will be no patience towards these practices and the truce could collapse at any moment," he said, adding Saudi Arabia would not tolerate any attacks on its border from Yemen.

The remarks came after a spokesman for Yemeni government forces loyal to former President Ali Abdullah Saleh, an ally of the Houthis, accused the Saudi-led coalition of a "serious escalation by land, sea and air", according to the Houthi-controlled Saba news agency.

The spokesman, Brigadier General Sharaf Luqman, said strikes from the sea were taking place on the Red Sea port city of Hodaida, ground forces had attacked Taiz city in southwest Yemen and air strikes by the Arab coalition had not stopped.

"We will respond strongly towards the breaches that are taking place by the alliance and their mercenaries," the Houthi-run Saba news agency (www.sabanews.net) quoted Luqman as saying.

"Coalition planes launched an air strike on the positions of the Houthis and Saleh forces in the Najd area of Sirwah district after they repeatedly violated the ceasefire," a tribal source said by telephone from the central province of Mareb.

Residents in Taiz said there was an air strike there after Houthi forces launched rockets on the area. Saudi state news agency SPA said the Houthis had killed one of its officers in a border area after the ceasefire was supposed to begin.

Local tribesmen held up a prisoner swap between the Houthis and southern fighters, local officials said.

Armed tribesmen from al-Baydah province in central Yemen blocked roads leading to the exchange venue, demanding that their relatives held by the Houthis also be included in the swap.

Officials from both sides had earlier said 360 Houthis and 265 southern Yemenis were on their way to be exchanged on the border between Yafe and al-Bayda provinces at midday.

Residents said mediators were trying to persuade the al-Baydah tribesmen to allow the swap to proceed.

The prisoner swap, brokered by Yemeni tribal chiefs, had been one of the most positive signs yet in the conflict.

Most of the Houthi prisoners are fighters aged between 13 and 16, captured when the Southern Resistance retook the southern port city of Aden in July.

Little official news has emerged from the Swiss talks organised by the United Nations, but delegates reached through social media sounded positive about the first two days of negotiations.-Reuters