THE crisis in Egypt lurched into a potentially dangerous new phase overnight as supporters of embattled President Hosni Mubarak faced off with anti-government protesters who defied a military call to disperse.

A crowd of 20,000 Mubarak supporters marched to Tahrir (Liberation) Square in central Cairo, the epicentre of nine days of unrest, far outnumbering the opposition supporters encamped there, Sky News reported.

Images showed the two crowds hurling missiles at each other during running street battles. Sky News correspondents at the scene reported seeing bloodied victims.

There were no signs of intervention by the police or military.

Egypt's opposition defied a call from the powerful military for protesters to disband, saying a major demonstration planned for Friday would go ahead.

"The demonstrators are determined to hold massive demonstrations on Friday, dubbed 'Friday of Departure,'" an organiser said, requesting anonymity for security reasons.

The veteran president announced on television that he would not run for re-election in September but would continue in office until then.

The pro-Mubarak protesters claim the leader has made enough concessions and should be allowed to stay in power.

Hundreds of protesters who camped for the night in the square woke to a call from the army to "go home."

"You have the power to bring stability back to the country," an army spokesman said on state television. "We are urging you as respectful citizens to go back home."

State news agency MENA announced that Egypt's parliament was suspended until the contested results of elections held late last year were revised, AFP reported.



The two houses of parliament "have decided to suspend their sessions indefinitely, until decisions are reached" about the results of the elections held in November and December, the news agency said.

The elections were marred by violence and accusations of widespread fraud and vote-rigging.

In a boost to the protest movement, internet services were restored in many parts of Cairo.



Egypt's government, which took the unprecedented step of shutting off internet access during the height of the protests, restored service Wednesday, said Hassan Kabbani, chief executive of cell phone service provider MobiNil.

Authorities also announced an easing of the curfew in Cairo and other Egyptian cities, which was widely ignored by protesters.

The curfew was changed from between 3:00pm and 8:00am local time to between to 5pm and 7am local time.

In the biggest rallies since protests began, some 500,000 people gathered in the capital Cairo and at least 400,000 turned out in Alexandria on Tuesday, a security source said.

Shortly after Mubarak's address, clashes broke out between pro- and anti-government protesters in Alexandria, Egypt's second largest city.

US President Barack Obama spoke on television to say he told the Egyptian president that an orderly transition needed to begin immediately.

"To the people of Egypt, particularly the young people of Egypt, I want to be clear - we hear your voices. I have an unyielding belief that you will determine your own destiny," Mr Obama said at the White House.

British prime minister David Cameron told parliament that Egypt's transition from Mubarak's rule "needs to be rapid and credible, and it needs to start now."

Oil prices crept higher yesterday, after spiking above $102 on the back of stubborn fears about the turmoil in Egypt and potential knock-on effects in the oil-rich Middle East, AFP reported.

