A huge fire at an oil depot on the outskirts of Tripoli was out of control Monday, sparking fears of a fireball that could cause carnage over a wide area.
The fire, raging since Sunday night, spread to a second fuel storage site in what the government called a "very dangerous" development.
"The situation is very dangerous after a second fire broke out at another petroleum depot," the government said, warning of a "disaster with unforeseeable consequences".
The blaze erupted when a rocket struck a tank containing more than six million litres (1.6 million gallons) of fuel.
The depots are located 10 kilometres (six miles) from the city on the road to Tripoli's international airport, which rival militias have been fiercely fighting for since mid-July.
Firefighters had been battling to extinguish the blaze, but ongoing clashes repeatedly forced them to flee the area.
A spokesman for the National Oil Company said: "The firefighters have now left the scene. The situation is out of control."
The government urged residents "living within a three kilometre radius of the scene (of the fire) to leave their homes immediately".
In its statement, the government issued yet another appeal to the combatants to "cease fire immediately".
But rockets were still being fired into the area, an AFP photographer reported.
The authorities feared the blaze could spread still further to a natural gas reservoir, where 90 million litres are stored.
- Pall of black smoke -
Fighting in the area has claimed the lives of 97 people and left more than 400 injured, the latest health ministry figures show.
Top world leaders Monday urged an immediate ceasefire and called on the UN "to play an essential role in facilitating the political process" to restore stability to Libya.
The appeal came after a conference call between US President Barack Obama, German Chancellor Angela Merkel, French President Francois Hollande and the British and Italian prime ministers, David Cameron and Matteo Renzi, according to Berlin.
On Monday, the first day of the Eid al-Fitr holiday marking the end of the Muslim fasting month of Ramadan, a huge pall of black smoke hung over the plant and explosions could be heard at regular intervals.
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While the oil burns, motorists in Tripoli are suffering severe petrol shortages, as service stations have closed over fears for the safety of staff in light of the fighting.
As lawlessness spreads, several countries, including Britain, France, Germany and Egypt, have warned their citizens not to travel to Libya, while the United States evacuated its embassy.
Other countries, among them the Netherlands, Belgium, Spain and Turkey have advised their nationals to leave the country immediately.
Italy and Malta have sent aircraft in the past few days to the Miitiga military airport to airlift their nationals out.
The exodus will further hit the strife-torn country, while the health ministry warned of a shortage of medical staff after the Philippines announced it was withdrawing its citizens, including health workers.
The Tripoli clashes, the most violent since a 2011 revolt which overthrew dictator Moamer Kadhafi, started with a July 13 assault on the airport by armed groups, mainly Islamists.
The attackers are battling to flush out fellow former rebels from the hill town of Zintan, southwest of Tripoli, who have controlled the airport for three years.
- Spiralling violence -
Washington evacuated its embassy staff Saturday, with Secretary of State John Kerry warning the mission had faced a "real risk".
The violence has also hit the eastern city of Benghazi, cradle of the 2011 revolution, where weekend fighting between the army and Islamists killed 28 people, mostly soldiers.
Fighting erupted on Saturday when Islamists attacked the headquarters of a special forces unit near the city centre.
Near-daily clashes take place in Benghazi, parts of which have become Islamist strongholds.
Libya, meanwhile, on Monday denied claims from Cairo that Egyptian nationals were among those killed in a weekend rocket strike on a Tripoli house.
Cairo had said a rocket hit a house in the capital Saturday, killing 23 people, including several Egyptians.
But Libyan interior ministry spokesman Rami Kaal dismissed the claim, saying: "News reported in the press about this incident is completely wrong".