Media playback is unsupported on your device Media caption Jeremy Bowen reports from Cairo where the army formed a protective barrier around protesters

Barack Obama has urged Egyptian President Hosni Mubarak "to make the right decision" to end weeks of unrest, and reiterated a call for an orderly transition of power "that begins now".

However the US president stopped short of telling Mr Mubarak to step down immediately.

He spoke as huge crowds demonstrated across Egypt for an 11th day, demanding that Mr Mubarak resign.

But PM Ahmed Shafiq said it would not be practical for the president to go.

He told the BBC Mr Mubarak's declaration on Tuesday that he would not seek re-election in September was tantamount to him standing down.

"In effect, the president has stepped down already," Mr Shafiq said. "We need him during these nine months."

At the scene There are still substantial numbers in Tahrir Square - it was a relatively peaceful night although there was some gunfire for a short period. The strategy now seems to be to kill the protest with kindness. The authorities have used rubber bullets and baton charges and - some strongly suspect - paid thugs and nothing has worked, so they are saying 'it's ok, you can protest as long as you like'. The government is encouraging people to go back to work - the banks will open again - and the hope is things will go back to normal and the whole thing fizzles out. They may think a hard core will remain in Tahrir Square which they can whittle down - but they may have underestimated how much they have lost control of much of the country - many other cities are close to chaos - whether it can return to a level where it can function normally is hard to predict. But President Mubarak is not going to resign unless absolutely forced to and the opposition fears if he can make it to the autumn, he can last even longer.

He separately told al-Arabiya TV that it was unlikely Mr Mubarak would hand over power to his new Vice-President, Omar Suleiman, because the president was needed "for legislative reasons".

Meanwhile, there were suggestions that the protesters would reduce their presence in central Cairo, holding big demonstrations only on Fridays, with smaller numbers there at other times.

On Saturday, there were also reports of a massive explosion at a pipeline that supplies gas to Israel. The blast caused a fire near the town of el-Arish, Egyptian state television reported.

'World is watching'

More than 100,000 people - including large numbers of women and children - gathered in Tahrir Square in the centre of Cairo on Friday for what was being called the "day of departure".

At noon, thousands paused for Friday prayers with one cleric declaring: "We want the head of the regime removed."

As the prayers finished, demonstrators renewed their chants of "Leave! Leave! Leave!", singing patriotic songs and waving flags.

Some people left as darkness fell, but thousands remained the square.

There were also demonstrations in Egypt's second city, Alexandria, and in the towns of Suez, Port Said, Rafah, Ismailiya, Zagazig, al-Mahalla al-Kubra, Aswan and Asyut.

In Washington Mr Obama told reporters: "The whole world is watching."

He said he had been encouraged by the restraint shown by both the authorities and the protesters after two days of clashes which have left eight people dead and more than 800 injured.

The UN believes more than 300 have died across Egypt since the protests began on 25 January, with about 4,000 hurt.

Mr Obama did not insist that Mr Mubarak step down immediately, but repeated his call for a "transition period that begins now".

Media playback is unsupported on your device Media caption Barack Obama: "We want to see this moment of turmoil turn into a moment of opportunity"

"He needs to listen to what is voiced by the people and make a judgment about a pathway forward that is orderly, that is meaningful and serious," he said.

"The key question he should be asking himself is: how do I leave a legacy behind in which Egypt is able to get through this transformative period? My hope is he will end up making the right decision."

BBC North America editor Mark Mardell says Mr Obama went further than before in suggesting that the Egyptian president should go, but could not quite bring himself - no doubt for very good diplomatic reasons - to say the words.

The Obama administration is relieved that Friday's huge protests did not turn nasty, because violence is the biggest threat to the change it wants, our correspondent says.

There were real nerves in Washington that the army would be forced to choose between their commander-in-chief and the people, he adds. Instead they remained neutral, keeping the rival groups of demonstrators apart.

Opposition talks

Egyptian Finance Minister Samir Radwan told the BBC on Saturday there "certainly will be a meeting" between opposition groups and Vice-President Omar Suleiman, although he did not say when or which opposition groups would attend.

Mr Suleiman has invited the leading opposition group the Muslim Brotherhood, but it has indicated it will talk only when Mr Mubarak has stepped down.

A senior member of the Brotherhood, Issam al-Aryan, denied Mr Mubarak's assertions that the movement would exploit the chaos if he stood down to seize power, saying it would prefer the opposition to nominate a consensus candidate.

"We want a civil state, based on Islamic principles. A democratic state, with a parliamentary system, with freedom to form parties, press freedom, and an independent and fair judiciary," he told the BBC.

Opposition leader Mohamed ElBaradei also took issue with the president's fear of the Brotherhood, saying such an attitude was "symptomatic of a dictatorship".

One of the leaders of the protesters, George Ishaq of the Kifaya (Enough) movement, told the BBC they intend reduce their presence in Tahrir Square, holding big demonstrations on Tuesdays and Fridays.

"Protesters will remain in Tahrir Square on all days of the week," he said on Friday. "But each Friday, there will be a demonstration like today."

Mr Ishaq said the new arrangement would remain in place until the president stepped down - he said it was time to let people go back to work and get on with their lives.