Street battles raged on Thursday between rival troops as well as between warring tribesmen, as violence which has already killed dozens spread across Yemen's capital, raising the spectre of civil war.

The gunbattles come after efforts to implement a Gulf-sponsored peace deal failed due to what its sponsors said were the soaring tensions between troops loyal to Yemeni President Ali Abdullah Saleh and opponents of his regime.

At least four civilians were killed when they were caught in the crossfire of the fighting that broke out early on Thursday between Republican Guard troops commanded by Saleh's son Ahmed, and dissidents loyal to General Ali Mohsen al-Ahmar, witnesses and medics said.

They said two women and a man were shot by snipers positioned on rooftops near and overlooking Change Square, the base of the anti-government protesters.

Another man died from wounds sustained when a mortar shell smashed into the square. Nine people were also wounded in the blast and several tents set up by protesters caught fire, according to witnesses.

Thursday's deaths bring the toll in the capital to 89 since Sunday. Fighting erupted later on Thursday in Sanaa's northern Al-Hasaba district, when gunmen loyal to powerful dissident tribal chief Sheikh Sadiq al-Ahmar traded fire with followers of Saghir bin Aziz, a tribesman loyal to Saleh, witnesses said.

There was no indication of casualties from that fighting, which an AFP correspondent said was rapidly spreading to other neighbourhoods.

"The city is empty. Schools, banks and businesses are shut as the ghost of war looms over Sanaa," one resident told AFP.

Another resident, who has been holed up in his home for days, said life had become unbearable.

"My children haven't slept in a week. They have nightmares every night from the shooting and the explosions," said Amin Al Faqih, 42, a father of three.

"My children beg me every day to take them to a place far far away from here, away from the nightly explosions and gunfire," he said.

Commuters said government forces have closed all entrances to the capital, with no cars allowed in or out.

The soaring levels of violence have raised long standing fears that Yemen, which is facing a Shiite rebellion in the north and the growing influence of Al-Qaeda in the south, is slipping towards full blown civil war.

Speaking to AFP late Wednesday, United Nations envoy Jamal Benomar said the deteriorating security situation, and the reluctance of both sides to reach a political resolution, raises "the risk of civil war breaking out."

Benomar arrived in Yemen Tuesday where he, and Gulf Cooperation Council chief Abdullatif al-Zayani, have been working to broker a peace-deal between the warring parties. Al-Zayyani left Yemen Wednesday after efforts to reach a political consensus failed.

He is expected in New York on Friday to discuss the Yemeni crisis with GCC foreign ministers and international diplomats who are gathered at the UN for the annual General Assembly meeting, a Yemeni diplomat said, requesting anonymity.

An AFP correspondent said the capital has been largely divided in two, with Al-Zubairi Road, a main boulevard in the centre of the capital, serving as a demarcation line and the main scene of fighting.

To the north of Al-Zubairi lies Change Square, where thousands of protesters are camped out, and the headquarters of Ahmar's dissident troops.

To the south, Saleh's security forces, and the Republican Guard troops are mostly in control.

The latest wave of fighting broke out on Sunday when swarms of protesters marching from Change Square towards the city centre in a bid to extend their sit-in came under fire from Saleh's forces.

Ahmar's troops quickly set up positions to protect the demonstrators, sparking violent streets battles between the rival forces.

In all, more than 85 people have been killed and several hundred others wounded since Sunday, mostly civilians caught in the crossfire or gunned down by Saleh loyalists, according to medics.

Yemen's President Saleh is recovering in Saudi Arabia after being wounded in a June bomb attack on his presidential compound in Sanaa.

Last week, Saleh granted Hadi some constitutional authorities that enable him to sign the GCC initiative but he has so far refused to do so.

Zayani and Benomar had been hoping to convince the opposition and Saleh's government to sign the initiative, which calls on Saleh to step down and hand over all constitutional authorities to Hadi. In return, Saleh and his family would be granted immunity from prosecution.