WRAPUP 5-NATO says Libya airstrikes cripple Gaddafi's forces

* NATO says Gaddafi weakened by bombing campaign

* Libya says coastguard boats were undergoing maintenance (Recasts, adds detail on Zintan, Tripoli port, quotes)

By Joseph Logan and David Brunnstrom

TRIPOLI/BRUSSELS, May 20 (Reuters) - NATO's bombing campaign in Libya has crippled the government's ability to attack rebels fighting to topple Muammar Gaddafi and effectively forced the leader into hiding, the alliance said on Friday.

It is nearly two months since NATO took command of a U.N.-authorized mission to stop Gaddafi's forces from attacking civilians, and Western governments including the United States, Britain and France are under pressure to show results.

Ambassadors of the 28 NATO states who met this week are confident the mission is making "steady and tangible progress" and, while fighting continues, the campaign has relieved pressure on rebel-held towns, NATO spokeswoman Carmen Romero told a briefing.

"NATO nations and partners agree we have taken the initiative. We have the momentum," she said in Brussels.

"Our mission remains unchanged -- we will prevent attacks and threats against civilians until the threat is removed. The evidence shows we are doing just that," she said, adding that NATO had helped relieve the siege on the port city of Misrata.

Three months into an uprising against Gaddafi's four-decade rule, rebels control the east and pockets in the west including Misrata. The conflict has reached a stalemate as rebel attempts to advance on Tripoli have stalled.

Tripoli calls the rebels criminals and al Qaeda militants and says NATO's bombing is armed aggression by Western nations bent on grabbing Libya's oil.

<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^

More on Libya [nLDE72H00G]

More on Middle East unrest: [nTOPMEAST] [nLDE73H1UN]

Libya graphics link.reuters.com/neg68r

Graphic on Libya refugees r.reuters.com/kew39r

^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>

Rebels and government forces fought a fresh battle in an area called Ryna around 10 km (6 miles) east of Zintan, a town in the contested Western Mountains region.

A Reuters reporter in the centre of Zintan heard artillery rounds and anti-aircraft gunfire. A rebel spokesman in the town, Juma Ibrahim, said it appeared pro-government forces were trying to advance and were firing tank rounds and heavy guns.

HOLES PUNCHED THROUGH SHIP

U.S. President Barack Obama on Thursday said Gaddafi's downfall was "inevitable" and a precondition for the start of a democratic transition.

The government dismissed Obama's speech, which was prompted by the "Arab Spring" uprisings that have ousted authoritarian rulers in Tunisia and Egypt and inspired the Libyan revolt.

Tripoli reiterated a ceasefire offer, saying government forces were ready to withdraw from cities if the rebels laid down arms. The rebels have rejected all advances so far, say they cannot trust Gaddafi and insist that he leaves power.

In a marked escalation of the campaign, NATO said on Friday it sank eight Libyan warships and intercepted a fuel tanker it believed was heading for the military.

"The destruction last night of the facility and a significant stockpile of the boats will reduce the regime's ability to sustain such tactics," Britain's Major-General John Lorimer said.

NATO also intercepted the oil tanker Jupiter on Friday, saying it believed the fuel would be used for military purposes.

Libyan officials took journalists late on Thursday to Tripoli's port, where a small ship spewed smoke and flames.

Missiles hit six boats. Five were coastguard vessels and one was a larger navy vessel but all had been undergoing repairs since before fighting started, said port general manager Mohammad Ahmad Rashed.

Journalists were taken to revisit the site on Friday. One 10-metre (30 foot) vessel bobbed next to a jetty but it appeared to be sinking. Two 50 metre vessels lay next to it. Both had mounted guns and one had a missile platform.

The larger ships were extensively damaged and one was partially submerged. Holes, 2-3 metres wide, were punched through the other. Twisted metal, lifeboats and bandages were scattered around, a Reuters reporter said.

By targeting shipping, NATO is effectively enforcing a blockade against civilians, Rashed said.

"We had been told if those ships moved they would be destroyed so they were docked here," said Amran al-Ferjani, chief of the Libyan coastguard.

DEFECTIONS

Libyan state television on Thursday showed footage of Gaddafi meeting a Libyan politician in Tripoli. The footage zoomed in on a TV in the room that showed Thursday's date.

Gaddafi was last seen on state TV on May 11. NATO bombed his compound the next day, and a day later the TV broadcast an audio clip in which he taunted NATO and said it could not kill him.

But a series of apparent high-level defections suggest Gaddafi is struggling to hold his inner circle together. His top oil official, Shokri Ghanem, has left and not been heard from for days although his name was on a list for a flight to Vienna.

U.S. Secretary of State Hillary Clinton told CBS television on Friday that pressure on Gaddafi's government was such that his wife and daughter fled across the border into Tunisia in the last two days and Ghanem has defected.

Tripoli says Ghanem is on an official visit to Europe but Tunisian and rebel sources say he has defected. [ID:nLDE74J0IP] (Additional reporting by Matt Robinson in Zintan and Isabel Coles in Cairo; Writing by Matthew Bigg, Editing by Jon Boyle)