Rebels retreated Wednesday from the key Libyan oil port of Ras Lanouf along the coastal road leading to the capital Tripoli after they came under heavy shelling from ground forces loyal to leader Moammar Gadhafi. (Photo: AP Photo/Altaf Qadri)

AJDABIYA, Libya (AP) — The defection of Libya's foreign minister, a member of Moammar Gadhafi's inner circle, is the latest sign that the embattled regime is cracking at the highest levels as the West keeps up pressure on the longtime leader to relinquish power.

In another blow to the regime, U.S. officials revealed Wednesday that the CIA has sent small teams of operatives into rebel-held eastern Libya while the White House debates whether to arm the opposition. Battlefield setbacks are hardening the U.S. view that the poorly equipped rebels are probably is incapable of prevailing without decisive Western intervention, a senior U.S. intelligence official told The Associated Press.

Despite the setbacks and ongoing NATO airstrikes on government forces, Gadhafi loyalists have been logging successes on the battlefield and reversing a rebel advance westward toward the regime's stronghold in the capital Tripoli. On Thursday, the rebels came under heavy shelling by Gadhafi's forces in the strategic oil town of Brega on the coastal road that leads to Tripoli. Black smoke billowed in the air over Brega as mortars exploded.

"Gadhafi's forces advanced to about 30 kilometers (18 miles) east of Brega," said rebel fighter Fathi Muktar, 41. Overnight, he said the rebels had temporarily pushed them back, but by morning they were at the gates of Brega. "There were loads of wounded at the front lines this morning," he said of rebel casualties.

Britain's government said Wednesday that Foreign Minister Moussa Koussa had arrived in Britain and was resigning from his post, though the Libyan government denied it. British Foreign Secretary William Hague said the resignation showed the regime is "fragmented, under pressure and crumbling."

Koussa is not the first high-ranking member of the regime to quit — the justice and interior ministers resigned early in the conflict and joined the rebellion based in the east. However Koussa is a close confidant of Gadhafi's privy to all the inner workings of the regime. His departure could open the door for some hard intelligence on the regime.

Koussa, before assuming the post of foreign minister, served for over a decade as Libya's foreign intelligence chief and is seen as one of Gadhafi's inner cadre.

Britain refused to offer him immunity from prosecution.

Adding pressure on Gadhafi's regime, the U.S. has made clear that it is considering providing arms to the rebels. Still, White House press secretary Jay Carney said Wednesday no decision has been made yet.

"We're not ruling it out or ruling it in," he said.

Obama said in a national address Monday night that U.S. troops would not be used on the ground in Libya.