U.S. Secretary of State Hillary Clinton thanked Malta for evacuating U.S. nationals from Libya at the start of the rebellion against Moammar Gadhafi during a visit to the island state on Tuesday.

The Maltese government "went the extra mile" to evacuate foreign nationals, Clinton said following talks with Prime Minister Lawrence Gonzi.

Libyan fighters raised the new government's flag over the oasis of Bani Walid Monday and hoped for the swift fall of the other remaining redoubt of Moammar Gadhafi loyalists, Sirte, as relatives of his henchmen fled.

Cries of Allahu Akhbar (God is Greatest) and bursts of celebratory machinegun fire filled the desert air over the centre of Bani Walid, as the new regime troops feted their capture of the loyalist bastion after a six-week siege.

A pro-Gadhafi TV channel confirmed the death of the toppled Libyan leader's youngest son, Khamis, who had been reported killed by National Transitional Council fighters late in August.

Arrai, a Damascus-based broadcaster that has become the favored forum for Gadhafi and the remnants of his ousted regime, said late Sunday that Khamis was killed August 29 in Tarhuna, some 80 kilometers southwest of Tripoli while fighting "enemies of the homeland."

The in absentia trial of accused in the disappearance of Imam Moussa al-Sadr and his companions came to an end on Friday with the verdict set for November 18.

The accused include ousted Libyan leader Moammar Gadhafi.

New regime forces in Libya were regrouping on Friday for a new bid to take full control of Moammar Gadhafi's hometown Sirte after a reverse at the hands of the fugitive strongman's remaining loyalists.

National Transitional Council (NTC) troops remained in the central police headquarters to which they retreated two kilometers on Thursday under heavy fire from Gadhafi forces, an Agence France Presse correspondent reported.

Libya's new government vowed on Thursday to investigate "every penny" of suspicious oil contracts signed under the former regime, responsible for what it described as "unbelievable" corruption.

"Any corruption under the previous regime will be investigated... There will be specialized committees that will look into all these contracts and agreements starting with the oil sector," the National Transitional Council's oil and finance minister, Ali Tarhuni, told a news conference in Tripoli.

Libya's new regime fighters retreated under heavy fire from loyalists of Moammar Gadhafi in his hometown of Sirte on Thursday as their leaders backtracked on an announcement they had captured one of his sons.

The advancing fighters, who had been hoping to mop up the last pockets of resistance in two residential neighborhoods in the northwest of the city, withdrew at least two kilometers to the central police headquarters they had captured on Tuesday, an Agence France Presse correspondent reported.

Loyalists of Moammar Gadhafi doggedly resisted attacks in two areas of the fugitive strongman's hometown Sirte on Thursday as doubts emerged about reports of the capture of his feared son Mutassim.

An announcement by the new leadership in Tripoli that Mutassim was in custody, sparked late-night celebrations in towns and cities across Libya but a senior military commander inside Sirte said that the son remained on the run.

Libya's new regime fighters Tuesday seized the police headquarters in the center of Moammar Gadhafi's hometown Sirte after the toppled leader's diehards deserted it, an Agence France Presse reporter said.

The National Transitional Council combatants celebrated the takeover of the strategic security building by honking the horns of their vehicles and firing into the air.

A group of more than 200 heavily armed gunmen attacked a mosque in the Libyan capital and ransacked the tombs of two imams, witnesses said on Monday.

"They arrived shortly after 10:00 pm (2000 GMT, Sunday night), between 200 and 300 of them, in pickups fitted with heavy machine-guns. They took off at about 1:00 am," said Mahmud Rahman, a resident of Tripoli's northeastern Al-Masri district.