South Sudanese government forces were Thursday battling to retake the key rebel-held town of Bentiu, as thousands of civilians continued to flee fighting and peace talks appeared deadlocked.
The fighting has been concentrated in the oil-rich Unity State in the north, and around Bor, capital of eastern Jonglei state, both main rebel strongholds.
Rebel delegates at peace talks held in neighbouring Ethiopia say they will only agree to a truce if the government frees a group of alleged coup plotters detained after the fighting began more than three weeks ago. The government has ruled that out.
Army spokesman Philip Aguer told AFP that troops loyal to President Salva Kiir were now "next to Bentiu," capital of Unity State and one of South Sudan's main oil-producing areas, and that clashes were continuing Thursday.
Scenes of anarchy
The UN aid chief in the country, Toby Lanzer, desribed a scene of anarchy inside the town. Shops "have been looted and destroyed", aid agency vehicles were being commandeered by armed gangs and civilians had fled, he said.
A local resident in Bentiu also described an atmosphere of "fear" as civilians braced themselves for an anticipated government onslaught.
Unity State is where much of fledgling oil producer South Sudan's crude is pumped. The country's oil production has dropped by around a fifth since the fighting began, depriving the impoverished nation of a key source of foriegn currency.
Peace talks deadlocked
The unrest began on December 15 as a clash between army units loyal to President Kiir and those loyal to ex-vice president Riek Machar. It has escalated into war between government troops and a loose alliance of ethnic militia forces and army units who have defected to the rebel side.
The exact toll of the conflict is unclear. The UN has said well over a thousand people have died, although sources from a number of relief organisations say they believe the number of fatalities is well into the thousands.
The US special envoy to Sudan and South Sudan, Donald Booth, shied from calling situation all-out civil war.
"Let's just call it a conflict right now, lets not escalate it ourselves," he told AFP in Addis Ababa, where the East African regional bloc IGAD has been trying to broker a truce.
"There's always a risk of escalation, that's for sure. That's why it's so important that the cessation of hostilities be the key priority," he added, confirming that the fate of political prisoners "has been a stumbling block" for the peace talks.
A young democracy at risk of "shattering"
South Sudan's young democracy risks "shattering" amid fierce fighting which left over 1,000 dead, a US official warned Thursday, adding Washington had no evidence of an attempted coup.
Speaking on the third anniversary of the nation's independence, US Assistant Secretary for Africa Linda Thomas-Greenfield told lawmakers: "Today, tragically, the world's youngest country and undoubtedly one of its most fragile democracies is in danger of shattering."
Kiir has denounced the fighting as an attempted coup by his ambitious rival.
But Thomas-Greenfield told the Senate Foreign Relations committee that "we have not seen any evidence that this was a coup attempt."
Rather she said the eruption of violence had been "the consequence of a huge political rift" in the country.
"Each day that the conflict continues, the risk of all-out civil war grows as ethnic tensions rise... and those who have remained on the sidelines are pulled into the conflict," she said.
"Political rivalries have taken on ethnic dimensions, atrocities are being committed, and men, women, and children are caught in the crossfire. This is not the future for which the people of South Sudan voted," she said.
Acknowledging that access across the country was difficult for aid agencies, she said that the "scale of the atrocities" was not yet known.
"Stopping the violence, and ensuring that Africa's newest nation continues to move forward rather than back wards, is of highest priority to the United States and the international community," she added.
The fighting was also creating new humanitarian needs in a country which is already one of the world's poorest.