Britain is running short of military targets in Libya as the forces of Libyan leader Muammar Gaddafi are increasingly using civilian infrastructure and vehicles, a Ministry of Defence source has said.
Along with France, Britain is the leading member of a coalition enforcing a United Nations-mandated air campaign over Libya to protect civilians from Col Gaddafi's forces, who have proved resilient despite nearly four months of air strikes.
The length of the bombing campaign has raised concerns in Britain and abroad that coalition members, of whom many have cut defence spending to tackle budget deficits, will not be able to sustain the tempo of attacks.
"We're not short of military assets. It's the targets. There's only so many targets you can take out whilst minimising civilian damage," the senior source said.
"We've had credible intelligence that Gaddafi is using civilian warehouses. He's definitely changing his tactics," said the source, who also echoed Nato claims that Gaddafi's forces were using civilian vehicles to deter air strikes.
Western states are frustrated by a five-month rebel campaign that - despite support from Nato warplanes - has failed to overthrow Gaddafi, and some governments are now looking instead to talks as a way out of the conflict.
Civilian casualties undermine Nato's mission to protect Libyan non-combatants. In June, the alliance admitted that its weapons destroyed a house in Tripoli in which Libyan officials said nine civilians were killed.
Senior British military staff have publicly warned of the growing strain on their resources caused by the Libya campaign, prompting calls for the defence ministry to re-open the comprehensive review of the military published last autumn.
The defence source dismissed calls to revisit the review.
Meanwhile, rebel forces are preparing for a new offensive south of Tripoli but tactical errors have raised new questions about whether they will be able to march on the capital.
Rebel commanders in the village of Al-Qawalish, about 60 miles from Tripoli, said they were massing their forces and preparing to advance east towards the town of Garyan, which controls access to the main highway into the capital.
But only a day earlier, the handful of rebels defending Al-Qawalish ran out of ammunition and fled when forces loyal to Col Gaddafi staged a surprise attack. The rebels took back the village before nightfall, with the loss of seven men.
"We came yesterday and we stayed here and we said we are not moving until the place is secure," said one rebel fighter who was manning a machine gun and gave his name as Tommy. "This mistake is not going to happen again. We're not going home."
Spirits were high in the rebel ranks, as hundreds piled into pickup trucks bound for the front line."All the military heads from the different villages are here; from Kikla, Zintan, Jadu, Rojban" said fighter Osama Azumi, who came to the front line in his taxi. "We are just waiting for the order to attack".
Yet the Russian presidential envoy who has been trying to broker a peace deal between Gaddafi's administration and the rebels said he believed the Libyan leader was far from beaten.
"Gaddafi has not yet used a single surface-to-surface missile, of which he has more than enough. This makes one doubt that the regime is running out of weapons," Russian newspaper Izvestia quoted Mikhail Margelov as saying.