TRIPOLI (AFP) -- Fighting raged Wednesday as Moamer Gahdafi's troops fought back near his Tripoli compound a day after it was captured, while rebels offered a $1.7 million reward for the elusive leader, dead or alive.
Meanwhile, international backers of the insurgency were moving to free up billions of dollars in frozen assets for them.
Thick smoke hung over the Bab Al-Aziziya complex, where rebels and Gadhafi forces were fighting in the afternoon with light arms, heavy machine guns, rocket propelled grenades and mortars, an AFP reporter said.
Fighting also spread to the nearby Abu Slim area, where loyalists were on the attack, in marked contrast to Tuesday's battle for Bab al-Aziziya when they fled as the rebels breached the gates.
However, rebel commanders said they were determined to push the loyalist troops out of the area, which houses the Rixos Hotel, where around 30 foreign journalists remain trapped in precarious conditions.
Many streets were deserted, with commanders saying dozens of pro-Gadhafi snipers had taken up positions.
"There are snipers above and around the perimeter of Bab al-Aziziya; there are dozens of them but we don't know where they are," said a rebel chief, Nuri Mohammed.
Two powerful blasts thought to be caused by an air strike rocked the capital early Wednesday as a NATO warplane flew overhead.
A rebel military spokesman speaking to Al-Jazeera television said "Libyan territory is 90 to 95 percent under the control of the rebellion."
Colonel Abdullah Abu Afra said "the fall of Bab al-Aziziyah marked the end of the Gadhafi regime in Tripoli and in Libya."
The whereabouts of Gadhafi and his family remains a mystery, but the former colonel broadcast a message in which he said his withdrawal from Bab al-Aziziya had been a tactical retreat.
Rebels said they had found no trace of Gadhafi when they swarmed through his compound on Tuesday.
In a speech carried early Wednesday by the website of a TV station headed by his son, Saif Al-Islam, Gadhafi said he had abandoned his compound in a "tactical withdrawal" after it had been wrecked by NATO warplanes.
"Bab al-Aziziya was nothing but a heap of rubble after it was the target of 64 NATO missiles and we withdrew from it for tactical reasons," he said.
In a later audio message on Syria-based Arrai Oruba television, Gadhafi boasted that he had taken to the streets of Tripoli without being recognized.
"I walked incognito, without anyone seeing me, and I saw youths ready to defend their city," he said, without specifying when he did his walkabout.
He also urged "the residents, the tribes, the elderly to go into the streets ... and cleanse Tripoli of rats" -- referring to the rebels.
Wherever he may be, the rebel National Transitional Council wants him, dead or alive, and has put a $1.7 million price on his head.
"The NTC supports the initiative of businessmen who are offering two million dinars for the capture of Moamer Gadhafi, dead or alive," NTC chief Mustafa Abdel Jalil said in Benghazi.
Abdel Jalil also offered amnesty to "members of (Gadhafi's) close circle who kill him or capture him."
Gadhafi spokesman Mussa Ibrahim told Arrai Oruba that more than 6,500 "volunteers" had arrived in Tripoli to fight for the regime, and called for more.
Insurgents, jumpy but jubilant and armed with assault rifles, combed the streets of the capital Wednesday for remnants of the regime.
"We are the champions. We've been dying for 42 years and now we are going to live," said Sharif Sohail, a 34-year-old dentist who had taken up arms to patrol the city center.
Rebels who secured Tripoli's airport on Sunday said it was still under sporadic attack by Gadhafi fighters, with snipers along the road from the city, and that a rocket on Tuesday had damaged an airplane on the runway.
Airport manager Arabi Mustafa said that once the security problems are resolved and water and electricity restored, the airport would be reopened.
Elsewhere, rebels advancing towards Sirte were blocked Wednesday in the town of Bin Jawad as loyalists kept a stiff resistance, an insurgent commander said.
After taking Ras Lanuf, 150 kilometers west of Sirte, the rebels had advanced up to Bin Jawad, but were stopped by heavy artillery fire, rebel commander Fawzi Bukatif told AFP.
"Gadhafi's forces are still fighting, we are surprised. We thought they would surrender with the fall of Tripoli," Bukatif said in the nearby coastal town of Zuwaytina.
"Maybe something or somebody is behind them," he said, adding "maybe" when asked if he was referring to Gadhafi or his sons.
In other developments, Britain and France said they are working at the United Nations to unfreeze Libyan assets blocked by Security Council sanctions.
"Diplomatically we're engaged at the United Nations and elsewhere to pave the way for the unfreezing of assets," Foreign Secretary William Hague said in London, shortly after France confirmed it was seeking a UN resolution to do so.
A British official said the resolution would include releasing assets to help rebels set up a government and meet urgent humanitarian needs.
It came a day after the United States said it was working through the UN to release up to $1.5 billion in frozen Libyan assets for the cash-strapped rebels.
In Moscow, President Dmitry Medvedev said Russia would recognize the Libyan rebels if they "unite the country" while warning that Gadhafi, the Kremlin's old ally, still retained influence.
"Despite the successes of the rebels, Gadhafi and his supporters still have a certain influence and military potential. We want them to sit down at the negotiating table and reach agreements on future peace," Medvedev said.
Not far from Wednesday's fighting, some 30 foreign journalists were still unable to leave their hotel after four days of siege.
"It's getting pretty miserable here and you can only imagine the sort of tension which the foreigners here, the journalists here, find themselves feeling at the moment," BBC correspondent Matthew Price told BBC radio.
Wednesday morning, some of the journalists attempted to venture a few meters from the hotel before gunfire erupted nearby and armed men ordered them back.
Electricity, temporarily cut, has been restored, but water remains scarce. Mobile phone signals are poor and food is in short supply.