TUNIS (Reuters) - Escalating conflict in the eastern city of Derna is having a devastating impact on civilians, with humanitarian workers denied access to deliver life-saving assistance, the United Nations said on Thursday.

FILE PHOTO - Debris is seen at a shrine inside the Sahaba Mosque after an explosion, in Derna early May 8, 2014. REUTERS/Stringer

Derna has long been encircled by forces loyal to east Libya-based commander Khalifa Haftar, who are trying to wrest the city from a coalition of local fighters and Islamists known as the Derna Mujahideen Shura Council (DMSC).

Located on the coast around 266 km (165 miles) from the border with Egypt, it is the only major town or city in the east of Libya outside the control of Haftar’s Libyan National Army (LNA).

This month after Haftar returned from medical treatment in Paris the LNA stepped up its campaign, launching ground attacks against its opponents on Derna’s outskirts.

The U.N. Libya mission’s humanitarian coordinator, Maria Ribeiro, said the intensification of the conflict had created an urgent need for humanitarian access and they had been denied repeated requests.

“Shortages in medicine and medical supplies are reaching critical levels and the first food shortages are being reported,” the statement said.

“The continued encirclement of Derna and the escalation of conflict is having a devastating impact on civilians who fear for their lives.”

Until this month, the LNA’s campaign had been largely limited to occasional air strikes and bombardments.

Egypt, which backs the LNA, has also carried out air strikes in Derna against what it said were training camps sending militants into Egypt to carry out attacks.

The LNA says its rivals in Derna are linked to al Qaeda. Islamic State established a presence in Derna in 2014, but was pushed out by the DMSC.

Haftar is aligned with a parliament and government that moved to eastern Libya following fighting in Tripoli in 2014. He opposes an internationally recognized government now based in the capital.

Haftar says he is trying to rid Libya of the threat from militant Islamists. Critics accuse him of branding all his opponents as “terrorists” as he seeks to expand his power.

“There is no option left for us in Derna than to crush the terrorists after they rejected all peace efforts,” Haftar said in an address to his forces on Tuesday. He also urged families of DMSC fighters to pressure them to surrender to the LNA so they could get a “fair trial”.

The U.N. statement quoted reports that hundreds of families had been displaced by the recent fighting in Derna, and that at least one child had been killed.

“I call on all parties to immediately allow safe and unfettered access to Derna for humanitarian actors and urgently needed humanitarian goods,” Ribeiro was quoted as saying.