Civilians pouring out of Muammar Gaddafi’s hometown Sirte said yesterday the horror of the battle for the city finally forced them to conquer their fear of the besieging new regime forces and leave.

In Cairo, US Defence Secretary Leon Panetta said Nato operations in Libya should continue as long as heavy combat on the ground continues.

“I think fighting has to end,” he replied when asked how long the air campaign would last. Nato operations were likely to continue as “they can’t continue to have the level of fighting that they have there”.

An AFP reporter said there was regular fire from National Transitional Council (NTC) tanks just outside Sirte late yesterday.

“Obviously there continues to be fighting by Sirte, by other areas” and “we still don’t know where Gaddafi is,” Mr Panetta said in Egypt.

But he said the conflict “certainly is moving in the right direction” and “a lot of progress has been made” since the Nato operation was launched in March.

The civilian exodus from Sirte comes as an NTC commander of forces besieging the other remaining loyalist bastion of Bani Walid said Col Gaddafi’s son Seif al-Islam was directing the last stand in the desert oasis.