HEISHA, Libya — Libyan rebels say they're closing in on Moammar Gadhafi and issued an ultimatum Tuesday to regime loyalists in the fugitive dictator's hometown of Sirte: surrender this weekend or face an attack.
"We have a good idea where he is," a top rebel leader said.
The rebels, tightening their grip on Libya after a military blitz, also demanded that Algeria return Gadhafi's wife and three of his children who fled there Monday. Granting asylum to his family, including daughter Aisha, who gave birth in Algeria on Tuesday, was an "enemy act," said Ahmed al-Darrad, the rebels' interior minister.
Rebel leaders insisted they are slowly restoring order in the war-scarred capital of Tripoli after a week of fighting, including deploying police and collecting garbage. Reporters touring Tripoli still saw chaotic scenes, including desperate motorists stealing fuel from a gas station.
In the capital's Souk al Jumma neighborhood, about 200 people pounded on the doors of a bank, demanding that it open. Civil servants said they were told they would receive a salary advance of about $200 for the three-day Muslim holiday of Eid al-Fitr, which starts today in Libya.
Rebel fighters were converging on Gadhafi's remaining bastion, the heavily militarized town of Sirte, some 250 miles east of Tripoli.
The rebels gave pro-Gadhafi forces there a deadline of Saturday — the day after the end of the Muslim holiday — to complete negotiations and surrender. After that, the rebels will "act decisively and militarily," said Mustafa Abdul-Jalil, the head of the rebels' National Transitional Council.
His deputy, Ali Tarhouni, said in Tripoli that "sometimes to avoid bloodshed you must shed blood, and the faster we do this, the less blood we will shed."
In an overnight phone call to AP headquarters in New York, Gadhafi's chief spokesman, Moussa Ibrahim, said the rebels' ultimatum would be rejected.
"No dignified honorable nation would accept an ultimatum from armed gangs," he said. Ibrahim reiterated Gadhafi's offer to send his son to negotiate with rebels and form a transitional government.
Ibrahim said he thinks that NATO believes Gadhafi is in Sirte "because much of his family and tribe is there."
On Monday, NATO hit about three dozen Gadhafi military targets in the Sirte area. NATO insists it remains within the bounds of its original mission of protecting Libyan civilians but appears to be paving the way for advancing rebel forces with its targeted airstrikes.
Diplomatic tensions rose between the rebels and Algeria after the Algerian government agreed to grant refuge to Gadhafi's wife, Safiya, daughter Aisha and sons Hannibal and Mohammed.
Aisha, a lawyer in her mid 30s, gave birth to her fourth child — a girl — as the family escaped.
An Algerian newspaper reported that the exiles, who included an unknown number of Gadhafi's grandchildren, had waited 12 hours to receive authorization from President Abdelaziz Bouteflika while Aisha was in labor.
The fate of Gadhafi's son Khamis continues to be in doubt. On Monday, rebel fighters said they believed Khamis, commander of an elite military unit, was killed in a rebel ambush south of Tripoli last week.