Official: Yemen's President Saleh alive and well after being reported dead in attack

SANAA (Reuters) - Shells struck Yemeni President Ali Abdullah Saleh's palace in Sanaa on Friday, wounding three senior officials, but a Yemeni official said Saleh was "well."

Fierce fighting engulfed the Yemeni capital, where residents cowered in their homes as explosions rocked the city.

Two Yemeni officials said Saleh escaped unhurt, but the prime minister, his deputy and the parliament speaker had been wounded in the attack, blamed by the government on tribesmen led by the al-Ahmar family. Four guards were reported killed.

"The president is well and he will address the people in one hour, there are some slight injuries among officials," Abdu al-Janadi, deputy information minister, told Reuters.

A Yemeni opposition TV station, Suhail, reported earlier that Saleh had died in shelling that hit the palace mosque.

Yemen has tipped swiftly toward civil war this week, with forces of the Hashed tribal confederation battling troops still loyal to Saleh in the capital and elsewhere.

More than 370 people have been killed, at least 155 of them in the last 10 days, since a popular uprising against Saleh's nearly 33 years in power began in January.

Before the attack on the palace, protesters paraded the coffins of 50 people it said were killed by Saleh's forces.

Heavy fighting also spread for the first time to the southern part of Sanaa, an area held by forces loyal to Saleh and possibly marking a turning point in the conflict.

Explosions were heard in the southern city of Taiz, where the United Nations has said it is investigating reports that 50 people have been killed since Sunday.

Two policemen were killed in a rocket-propelled grenade attack, medical officials said, after security forces fired warning shot earlier at protesters gathering for Friday prayers.

Worries are growing that Yemen, home to a branch of al Qaeda known as AQAP and next to the world's biggest oil exporter Saudi Arabia, could implode and become a failed state that poses a risk to global oil supplies and security.

In Sanaa, thousands have fled for safety as Saleh's security forces battled members of the powerful Hashed tribal alliance led by Sadeq al-Ahmar in the bloodiest fighting since pro-democracy unrest erupted. One of the homes of a brother of Ahmar was shelled in fighting on Friday, witnesses said.

Defying world pressure, Saleh has thrice reneged on a deal brokered by Gulf states for him to quit in return for immunity from prosecution, even as he hemorrhages support at home.

"Even if the president would agree, and so far he has shown no intention, one could not ensure the transition will go smoothly given there are so many risks involved," said Christian Koch, of the Gulf Research Center in Dubai.

The bloodshed has eclipsed a mostly peaceful pro-democracy movement inspired by successful revolts in Egypt and Tunisia.

Yemen is engulfed in multiple conflicts, with street battles between tribal groups and Saleh's forces in Sanaa, popular unrest across the country and fighting against AQAP and other Islamist militants who seized the coastal city of Zinjibar.

The capital is split, with Saleh loyalists holding the south against tribesmen and renegade military units in the north.

One constant factor is Yemen's crippling poverty. Jobs and food are scarce, corruption is rampant and two-fifths of the 23 million people struggle to live on less than $2 a day.

(Additional reporting by Mohammed Mukhashaf in Aden, Khaled al-Mahdi in Taiz, Mahmoud Habboush in Dubai and Samia Nakhoul in London; Writing by Jon Herskovitz; Editing by Alistair Lyon)

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