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Libyan Rebels Battle for Tripoli; Gadhafi Forces Hold Reporters' Hotel; Gadhafi's Son: "I'm Being Attacked"; Moammar Gadhafi's Location Unknown; President Calls on Gadhafi to Give Up Fight; World Reaction to Libya; Rebels Control Most of Tripoli; Boat Rescuing Migrants in Libya; NATO Worried About Civilians; Obama: Libya Slipping from Gadhafi; Libya Oil Flow Could Resume; U.S. Officials: In Contact With Rebels

Aired August 22, 2011 - 09:59   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

KYRA PHILLIPS, CNN ANCHOR: You're watching CNN's special coverage of the battle of Tripoli. Here's what's new right now. After celebrating their sweep into the very heart of Libya's capital, then encountering heavy resistance, rebel fighters have now pulled back from Green Square. They're coordinating their next offensive.

Meantime rebels say they have detained a prominent anchor from Libyan state TV. You may remember she made headlines over the weekend waving a gun around on air and threatening rebel fighters.

CNN's Sara Sidner is in the heart of Tripoli and Matthew Chance is in the city's Rixos Hotel, the same hotel senior Libyan officials and their families just fled.

Nic Robertson was our first correspondent into Tripoli at the start of the uprising. He's in Washington. Zain Verjee is following international reaction from London.

Jill Dougherty is checking diplomatic developments at the State Department. Dan Lothian with President Obama is in Martha's Vineyard and Kate Bolduan has the political perspective from Washington.

Let's begin by getting to our Matthew Chance. He is at the hotel for international journalists in Tripoli, still until control by Gadhafi forces.

MATTHEW CHANCE, CNN SENIOR INTERNATIONAL CORRESPONDENT: We've been sort of weighing our options. We're in a bit of a difficult position because we're sort of a man down on the team. We don't have a cameraman with us, so we're a bit stuck anyway.

We also haven't got a vehicle, so that's a problem. Previously we've been depending on the government to take us around. That was the only way we were allowed to get around. We've been deprived of that.

The other situation, of course, the overriding situation is the fact that the government is still very much in control of this hotel in the perimeter, and they're not permitting us to go outside.

A number of journalists have been requested to leave the grounds, and they've been refused. You have armed men in the lobby of this hotel, in the trees around the compound as well and heavy weaponry on the perimeter we're thinking about hunkering down and waiting for this to pass, whatever comes next.

PHILLIPS: Now just ahead of an exclusive phone interview on Al Jazeera reportedly with Moammar Gadhafi's son, Mohammed. Al Jazeera and one of its anchor said that rebels had surrounded Mohammed's home and planned to take him to Benghazi.

That anchor added in an exchange of gunfire one of the Moammar's guards was harmed and a rebel fighter was killed. Here's a part of that dramatic interview.

(BEGIN VIDEO CLIP)

MOHAMMED GADHAFI, SON OF MOAMMAR GADHAFI (via telephone) (through translator): Standing outside my house. I'm being attacked. There's gunfire inside my house. They're outside my house, good-bye, good- bye, good-bye.

(END VIDEO CLIP)

PHILLIPS: Well, the Al Jazeera anchor then reported that according to the chairman of the Transitional National Council Mohammed Gadhafi and his family have not been harmed, but their movements are under the control of rebel forces.

Now at least two of Mohammed's brothers are in rebel custody as well, but Moammar Gadhafi, his whereabouts are still unknown. Nic Robertson is telling us more on Gadhafi and possibly his whereabouts.

We've mentioned earlier, Nic, you have interviewed family members over the year. What is your take and what are your sources telling you right now?

NIC ROBERTSON, CNN SENIOR INTERNATIONAL CORRESPONDENT: Well, my take is that they were out-maneuvered quickly, that they didn't anticipate how quickly the rebels would get into the city. That seems the only logical explanation why, Sadi Gadhafi and Saif Al Islam Gadhafi would get picked up and Mohammed Gadhafi as well.

Sadi Gadhafi is perhaps the member of the family that's been most on the sort of outside, if you will, of the key sons. He hasn't had a top military job and he hasn't been in the sort of leadership position.

He's essentially been pushed to one side. There was even talk that he wanted to get out of his country, but he said his brother Saif was the one that was running the country on a day-to-day basis. So the fact that he's been picked up seems to indicate that they just didn't expect the rebels to get into the city so quickly.

And therefore, the assumption has to be the father, Moammar Gadhafi in the same position surrounded by sick fans telling him that the people love you, telling him that everything will be OK. And that if he did have a plan to bolt out of the city and jump on a plane and fly somewhere else, he could execute that at the last minute.

Time it does seem to -- in his case seems to have run out. If he's holed up now in Tripoli, it seems to be in one of those areas that the rebels are trying to get into, how long can he hold off there? That's anyone's guess and really exactly where he is, also anyone's guess, Kyra, a lot of rumors right now.

PHILLIPS: So Nic, what is your take? What could the rebels get from Gadhafi's sons?

ROBERTSON: They will get the knowledge that they have begun to round up the regime they so detest and despise. The symbolic victory will be important if as Sadi Gadhafi said his brother, Saif, sort of heir apparent to Gadhafi, the leader, was really running the country on a day-to-day basis then that's going to deprive the country of some direction.

Gadhafi himself is so mercurial, what real impact having his sons removed from the equation will mean, but we know from the very beginning when the bombing began that the family hunkered down together. That this was a family -- they relied on themselves.

Perhaps the only other insider, Abdullah Senussi, the head of the intelligence, another man who sort of one of the three wanted by the International Criminal Court for war crimes, very small trusted group.

So it seems that that group is now broken up and that Gadhafi will feel more isolated because of it. But is it going to change anything? Probably not. Even his family found him unpredictable.

In my conversations with Sadi Gadhafi, he found his father on the one hand sympathetic. On the other hand, dismissing him -- when I talked to him, he didn't have a strong idea of how to bring the country under their control.

PHILLIPS: So would the sons even know where their dad is?

ROBERTSON: Yes, you would have to believe there would be the possibility of that, but would the rebels -- the father have moved since they were picked up? Quite possibly even if they told the rebels there's no guarantee that the rebels would be able to move in and then find Gadhafi.

It may be quite obvious on the ground the fact that some parts of the city typically those around Gadhafi's strongholds in the city are the ones that the rebels are trying to get into does seem to indicate that perhaps he is holed up there.

The international airport, he would try to flee from there by plane, if he could. There's a military air field, which is closer to his compounds. If again, if he had aircraft on standby, as has been rumored then that's why he would try and fly from the military airfield is where Gadhafi and his sons kept their private aircraft.

We believe that those have been destroyed during the NATO campaign, but that would be one of the obvious places for him to run, it's down on the coast. He may simply not be able to get there now, Kyra.

PHILLIPS: Got it. All right, Nic, thanks so much.

Let's take it over now to Zain Verjee. She live out of London with reaction from around the world to what's happening in Libya. But Zain, you actually mentioned last hour and I didn't get a chance to talk with you much about it.

That you have actually met with one of Gadhafi's sons. Tell us about that, and what's your take on the boys and their influence now?

ZAIN VERJEE, CNN INTERNATIONAL ANCHOR: I only met Saif Al Islam Gadhafi when I was in Tripoli. It was a big moment, because the former U.S. secretary of state, Condoleezza Rice was going there, the first secretary of state in 50 years.

Saif Al Islam was riding really high because not only was he seen as a potential successor to his father, Moammar Gadhafi, the west embraced him for what they perceived to be a modern reformist attitude.

He opened up Libya for business. He influenced his father to giving up Libya's weapons of mass destruction program, and also paid compensation to families of victims of the Lockerbie bombing.

But the situation then occurred in Libya with the uprising, many people around the world thought, OK, this is someone who can broker some kind of peace deal, but they threw that away.

He threw it in. He got on TV and started shouting about rivers of blood. Many people then accused him of just having been a wolf in sheep's clothing. He's now wanted by the International Criminal Court for Crimes against Humanity and War Crimes.

PHILLIPS: What do you think? Would he ever -- if he knows exactly the whereabouts of his father? Is this one that would turn against his dad ever, or lead -- you know, be forced to give out any information?

VERJEE: Well, many experts have said if he was going to betray his dad, he would have done it by now. He had one important moment and one important choice to make, which way would he go and he threw it all in with his father.

It's likely that Moammar Gadhafi continues to move to difficult locations. So in the event of a situation like this, Saif, Sadi or Mohammed Al Gadhafi may not even know where he is. It's unlikely that he would give his father up, but under pressure to save his skin, who knows in a situation like this.

PHILLIPS: Got it. Zain Verjee out of London. Zain, thanks so much.

Now let's head over to Dan Lothian. He is in Massachusetts with the president, who's calling for Gadhafi to step down, as you know. Dan, could we hear from the president today?

DAN LOTHIAN, CNN WHITE HOUSE CORRESPONDENT: That's the big question we've been asking since last night. And at this point nothing on the president's schedule. The only thing we've heard from the president himself last night as he was going to a local takeout restaurant in Oak Bluffs.

He was asked to comment on the situation in Libya and president making it clear he would be holding back any public statements until they get more information about what's going on. The president saying, quote, "we're going to wait until we get full confirmation of what is happening. I will make a statement when we do."

But the president did put out a written statement where he said in part the momentum against Gadhafi has reached a tipping point that Gadhafi and his regime's rule has come to an end and he needs to relinquish power once and for all.

The president today will be receiving a briefing on Libya from one of his top advisers, John Brennan, who is traveling with the president. The president has been getting frequent updates on the situation there over the last few days.

While the administration has not said so publicly, this is no doubt a positive move. They see it coming some six months after the president first called for Gadhafi to step aside.

Gadhafi digging in, defying not only calls from the west, but other allies, NATO as well with the pressure has been ramped up. That situation, of course, very fluid now and the White House is waiting to see what happens before the president steps in front of the camera.

PHILLIPS: OK, Dan Lothian, thanks.

Well, you know, Washington is applauding the imminent fall of Moammar Gadhafi, but it will be a long road ahead for the Libyan people. We have a live report right after the break.

And if a new government takes over Libya and the oil starts pumping again, what will happen to the price of your gas? We'll talk about that as well.

(COMMERCIAL BREAK)

PHILLIPS: As you can imagine, a number of our lawmakers are weighing in on Libya this hour. Kate Bolduan is on the Hill joining us -- usually she's on the Hill. She's joining us live out of Washington this morning.

So Kate, let's talk about who are we hearing from and then who we're not hearing from? First of all, what is the latest from your vantage point on who is coming out and speaking strongly about Libya?

KATE BOLDUAN, CNN CONGRESSIONAL CORRESPONDENT: According to two top senators on military and foreign policy issues, the fall of Moammar Gadhafi, Kyra, is being called a victory for the Libyan people. And as they say, the broader cause of freedom in the Middle East and throughout the world.

Senators John McCain and Lindsey Graham, two Republican senators, they released a statement applauding the efforts of the Libyan people and international community for reaching this point, adding that Gadhafi's fall should now send a message to other nations and other embattled leaders.

Namely in their statement, Bashar Al Assad of Syria saying, quote, as they say in their statement, "We are confident that his regime will soon join Gadhafi's on the ash heap of history," but also listen here to Senator McCain. He was on CBS "Face The Nation." And he was talking about still the long road ahead for Libya. Listen here.

(BEGIN VIDEO CLIP)

SEN. JOHN MCCAIN (R), ARIZONA: It's going to be a big challenge forming a new government, uniting a country that's never known democracy. We've seen the difficulty with other countries that have made this transition, but we'll be rid of a guy that has a blood of Americans on his hands. We will be rid of a guy who's practiced the worst kind of brutality, and now it's going to be up to us and the Europeans.

(END VIDEO CLIP)

BOLDUAN: Now while applauding the latest developments McCain is also criticizing the Obama administration for not doing more to end this conflict sooner. McCain is saying that the U.S. unfortunately has led from behind here, something that we have heard a criticism from Republican members in the past.

And I should say, of course, Kyra, that Senator McCain and Senator Graham have both long been strong voices from the perspective of U.S. lawmakers who have been pushing for greater involvement of U.S. military involvement and greater involvement just from the U.S in general in trying to bring this conflict to an end. Kyra --

PHILLIPS: Now, Kate, we haven't heard from any of the GOP presidential candidates on this, have we?

BOLDUAN: I haven't seen any statements out yet. Maybe it's just slowing the uptake. Maybe we're just trying to bring those statements in. Many people are just trying to calibrate really what the situation is.

And I'm sure watching CNN as well, just trying to see all of this unfold as we are, before they put out their statements. Not a surprise we are hearing quickly from Senator McCain and Senator Graham. They've been very vocal, very strong and very out front on these military issues.

PHILLIPS: All right, our Kate Bolduan out of Washington. Kate, thanks.

Now before the war, Libya pumped out nearly 2 percent of the world's oil. If that flow starts up again soon, what could it mean to all of us? Christine Romans is in New York.

We've already seen oil prices drop overseas so do prices look they'll keep sliding, Christine?

CHRISTINE ROMANS, CNN BUSINESS CORRESPONDENT: Well, it's interesting, because here oil prices are going up a little, but they're going up with stock prices because today at least the mood is that maybe it won't be a double-dip recession.

But overall you have euphoria quite frankly that if you had Libya back on the market that would be a significant supplier of crude oil, light sweet crude oil, the kind that's easiest to refine for Europe.

And if you don't have Europe worrying about that big quantity of oil then that's better overall for the markets. Remember the president tapped the emergency oil reserves in this country earlier this year because they said of the oil that was off the world markets.

So how big is it? It's the 17th largest oil producer, at least it is in good times when it's not suffering through six months of civil war. Two percent of the world's oil supply, again before its civil war, 1.8 million barrels a day.

The U.S. directly consumes only about 3 percent, Kyra, of Libya's oil exports, almost all of it goes straight to Europe, which is basically has voracious appetite for Libyan oil, but again, when you're competing for restricted supplies around the world.

I mean, every drop of oil that is sucked out of the earth is used, so longer term, many say this is good, good for the fundamentals for consumers, the oil market. How long though, Kyra, will it take after six months offline for them to get back up to full production and begin exporting again? That's a big question mark at this point.

PHILLIPS: OK, so we really can't gauge whether we could see lower gas prices if we wanted to tie it to the situation in Libya.

ROMANS: You know what? We're going to see lower gas prices, because the U.S. economy is slowing. This is something that adds to that, it helps that situation overall, yes.

PHILLIPS: Got it, Christine Romans out of New York. Christine, thanks.

Going forward in Libya, what will a transitional government look like? We'll try and piece that together, up after the break.

(COMMERCIAL BREAK)

PHILLIPS: All right. Let's check in with the latest now in the battle for Tripoli. Rebel fighters planning their next offensive against pro-Gadhafi forces after some pretty big gains earlier today, the rebels came under heavy fire and had to retreat from Tripoli's Green Square.

Meantime Moammar Gadhafi is still MIA, and the opposition thinks he's either hiding out in Tripoli or has fled to southern Libya, Chad or maybe Algeria. U.S. official sounds a little more certain, saying, quote, "There is reason to believe he remains in Libya." No details on what intel the administration might have.

Well, the White House says that Gadhafi should go and prevent further bloodshed. National security correspondent Jill Dougherty is at the State Department, apparently getting new some information on the situation there in Libya. Jill, what do you have?

JILL DOUGHERTY, CNN NATIONAL SECURITY CORRESPONDENT: Yes, Kyra, it is interesting. It's coming from Jeff Feltman. He is the assistant secretary of state for Near East Affairs. I've reached him in Cairo. He's there now, but he was in Benghazi, the rebel stronghold over the weekend.

He says that senior Libyan officials were actually reaching out to the United States in those last moments before the rebel onslaught began, and Feltman is saying that this was obviously -- or it felt it was an attempt to buy some time, to stop what they felt was inevitable.

They were willing, he says, to negotiate in general, but when it came to would Moammar Gadhafi leave or step down. They want that's not negotiable those telephone conversations, by the way, stopped on Saturday.

Also, Feltman saying that the initial signs from Tripoli, where the rebels now are, are encouraging that there's no report of any widespread looting, no reports of anybody taking justice into their own hands for retribution. He says he's also encouraged by reports there are checkpoints for public security and safety around public buildings.

And then finally, interestingly, Jeff Feltman again, Assistant Secretary of State for Near Eastern Affairs saying that there appears to be more communication than even he expected, and he's the person that leads up the state department on Libya.

Between the rebels who are the fighters in Tripoli, and the TNC, the Transitional National Council that's back in Benghazi, that they were actually able to predict some of what happened. Also, a bit of caution coming separately from a senior administration official, who says the TNC has a lot of plans on paper.

They look good, but the issue right now is interim period right now, can they actually carry them out. The plans exist, they say so far, and now it's a question of in this chaotic period, whether all of that can come to pass.

PHILLIPS: Jill Dougherty from the State Department. Jill, thanks. And our Wolf Blitzer is ready to join us after the break. Stay with us.

(COMMERCIAL BREAK)

PHILLIPS: Just about half past the hour. Here's the latest details on the battle for Tripoli. Rebel fighters planning their next offensive against pro-Gadhafi forces after some pretty big gains earlier today. The rebels came under heavy fire and had to retreat from Tripoli's Green Square.

Meantime Moammar Gadhafi MIA, and the opposition thinks that he's either hiding out in Tripoli or has fled to southern Libya maybe Chad, possibly Algeria. A U.S. official though sounds a little more certain saying, quote, "There is no reason to believe he remains in Libya. No details though on what intel the administration might have at this point.

So we've been telling you about the fighting in and around Green Square today. It's been a big symbol for the Gadhafi regime. In fact, until recently they had been using it for big pro-government demonstrations.

CNN's Sara Sidner has been right there watching the rebel invasion and some pretty heavy fighting. She filed this report for us just before the rebels pulled back from the Square.

(BEGIN VIDEOTAPE)

UNIDENTIFIED MALE: Finish, finish. Gadhafi finish.

UNIDENTIFIED MALE: Tripoli very, very happy. Gadhafi finish. Now leave.

SARA SIDNER, CNN INTERNATIONAL CORRESPONDENT: We are in Green Square and what you're seeing behind me are the rebels are now saying there's going to be a massive battle here. They do not have full control of the city.

UNIDENTIFIED MALE: At the moment we're not fully in control of Tripoli because you can see, you can see that.

SIDNER: What is this making -- how do you feel about this day? You are from Tripoli. Why is this day important, a historic day?

UNIDENTIFIED MALE: Historic day because we had to leave from here and now we had it to fight. I'm not a fighter. I'm a student. It's my first time to like handle a gun.

SIDNER: The civilians are now gone from here and now we also have to leave. What's happening as everyone starts running? We are here in the middle of Tripoli. What we're seeing are rebels all over the Square. There are really no civilians, mostly men with guns in the square, but we are also seeing people running. There's a lot of gunfire. They say they are snipers. We all had to pull back. The situation is very tense here, but there's a lot of celebrating going on.

Some of this is gunfire in the air, but people are very, very concerned because they say there were snipers close to - to some of these buildings. They're not sure exactly where some of this gunfire is coming from.

So every now and then, you see people just running trying to get out of the way, but right now the rebels have Green Square, and it is a historic moment here in Tripoli in the capital, the real stronghold of Moammar Gadhafi has been taken over by the rebels. Sara Sidner, CNN, Tripoli.

(END VIDEOTAPE)

PHILLIPS: All right. Our Wolf Blitzer is watching the battle for Tripoli as well. He's joining us from Washington. Wolf, if you don't mind, I would like to talk about the politics, the reality on the ground, and the future of the region.

Why don't we go ahead and start with the president. You probably saw Ed Rendell's claim that this is a foreign policy victory for the Obama administration, what's your take? Do you think it's too early to make those claims?

WOLF BLITZER, CNN HOST, "THE SITUATION ROOM": Well, if Gadhafi is gone, and by all accounts if he's not gone yet, he will be gone very soon. That's a victory for the United States, for NATO, for most of the democracies in the world, certainly in the region, given Gadhafi's history over 42 years.

So without Gadhafi in Libya, that's a big gain. Having said that, we don't know what the transition is going to look like. We don't know what the final government will look like. I know that right now they are united, this transitional council.

They're united in their opposition to Gadhafi, but they're not necessarily united amongst themselves. They have various different interpretations of what a future Libya should look like. So there are a lot of questions marks. Having said all of that, the NATO allies went in with U.S. leadership in March. Now Gadhafi is gone or at least he's on the verge of being gone. That certainly represents a plus for the U.S.

PHILLIPS: And Wolf, you talked about the National Transitional Council being in - or working together right now. But you're talking more than 140 tribes. This could still be a very dividing moment as well. And there's a lot of concern, how do we prevent a civil war? We know Gadhafi is going to be gone, and we know the TNC is going to be in place, but it could get worse with the looting and the division.

BLITZER: And taking revenge over the next few days and weeks. There's so much uncertainty right now. And there's little control. And so, you say looting. Yes, looting is going to be a big issue. I suspect the people are going to try to start stealing important artifacts, all sorts of other things.

And then there's going to be people just wanting to kill others. Pro-Gadhafi elements are going to be endangered if the rebels get by. Look, a lot of people have lost loved ones, lost family, friends, and there will be an effort to take revenge. And there's no one right now - no national leader along the lines of a Nelson Mandela, shall we say, in South Africa that can stop that kind of torment from developing. So, it's going to be rough situation; there's no doubt about it.

One thing that know U.S. officials are worried about, they want to try to protect as much as they can, even though they have limited capabilities or some of the archives -- the governmental archives -- Gadhafi has been involved in all sorts of activities, including the Pan Am 103 downing and the killing of those Americans at that disco in Germany. So, there's a lot of history that the international community would like to get its hands on. I don't know what, if anything, the Gadhafi regime is doing about burning archives, destroying history, whatever. But that's one issue I'm sure will come up in the coming days.

PHILLIPS: Wolf, we've heard from various senators on Libya. And I asked Kate Bolduan this, and it's tough to find really a direct answer. Do you have any idea why we're not hearing from the GOP presidential candidates?

BLITZER: I'm sure we will over the course of the next few days. This has not been a huge issue on the campaign trail. The issues on the campaign trail have been the economy, jobs, taxes, Medicare, those kinds of domestic economic issues. National security really hasn't played a big role on the campaign trail. But I suspect we will get statements from Mitt Romney and Governor Perry and Michele Bachmann and the other Republican presidential candidates.

The story really broke last night as the troops, the rebels were moving into Tripoli, the capital, moving into Green Square, which they have now renamed Martyr Square.

But I suspect you'll be hearing from the candidates. And we did hear, as you pointed out earlier, from Senator McCain and Senator Lindsey Graham. They issued a strongly worded statement, and they indirectly took a swipe at the Obama administration for supposedly not going more quickly and leading more robustly in the air campaign against Gadhafi's forces.

PHILLIPS: Wolf, stay with us, as we continue our breaking news coverage on Libya.

But I understand we have him miked up and ready to go. A former translator for Moammar Gadhafi. You know, as the rebel forces close in on Tripoli, we are -- it's kind of hard to figure out what's next, and what's going inside Moammar Gadhafi's mind. But Abubaker Saad is a professor at Western State Connecticut University now, and was, as I mentioned he was an aide and interpreter to Gadhafi himself.

Sir, I'm glad we have a chance to talk with you this morning. That seems to be the $50 million question, where is Moammar Gadhafi? What is going through his mind right now? Will he cut a deal? Will he flee? Will he stay to the bitter end?

You obviously know him or knew him very well at one time. What is your take as you watch everything that's happening right now?

ABUBAKER SAAD, FORMER GADHAFI AIDE: Well, as we sit right now, Moammar Gadhafi -- I know and I worked for him for nine years. I know he's not going to surrender. He's not the kind to surrender.

Also, many people are now wondering where he is. My suspicion -- and I am not so sure of it -- my suspicion he had left Tripoli quite a while ago. He's probably hiding either in his hometown of Sirt or at his tribal stronghold down in the southwestern Libya.

So, those are the possibilities. Watching the news and following what's going on in the past week, especially hearing the -- his messages on the phone, that indicated to me that he was not talking from Tripoli. He was talking from far away. And those areas are out there.

I have very strong suspicion that he had been whisked out of Tripoli days ago, not just -- he's not hunkering in Tripoli as most people think. That's my own interpretation of it. I could be wrong, but really that's my own interpretation of it, of the person I know.

And he is not going anywhere. He refuses to go anywhere, and his personality is going to fight for the very end. Of course, the end is getting close. Most of his forces are abandoning him, they are surrendering very quickly. But he still has some strong loyal supporters who are going to fight with him to the end. So, it's not over in Tripoli. It is not over in other parts of Libya.

We have to be careful here not to celebrate too soon. We have to be careful with this man because this man has the knack of regrouping. If you remember, way back in February when uprising took place, all of a sudden, many of the towns rose up, and he lost them. And all of a sudden, two weeks later, he got his grip back on it again.

So, he's going to fight. He's very resilient.

PHILLIPS: You think at this point he could actually regroup?

SAAD: He will try to fight to the bitter end, even if he recruits 100 people around him. He is not going to surrender. He is going to fight to the bitter end.

PHILLIPS: He may be able to regroup, but there is no way he's going to be able to regain control.

SAAD: No, no.

PHILLIPS: Are you saying --

SAAD: No, no, that's not what I'm talking about. I'm not talking about regaining control. I'm talking about making it difficult to secure the country. He is going to make it difficult for the TNC to peacefully take over the whole place.

And this is really will be their main problem, is to prevent anarchy. Is to secure the safety of the population, because his rule of 42 years had created a lot of hatred within the country against him and against his followers, so the revenge factor is there. We have to be very careful with that, with the revenge factor, because Libya is a tribal society. Libya is family connected, and anybody in the family who had been tortured or killed by Gadhafi's regime wanted to revenge.

So, we have to really be careful in the next couple days in order to may sure that the TNC actually controls the situation peacefully.

PHILLIPS: And what do you make of his sons being captured? And will any of his sons betray him?

SAAD: I don't think they have a chance to betray him. Because first of all, Saif al-Islam is wanted by the ICC. Saif al-Islam is wanted by the Libyan people.

So the only son that I would suspect that he -- that the TNC and revolutionaries will definitely be a little more lenient with him is his son Mohammed, the one who surrendered himself last night. But both Saadi, and Saif al-Islam. And there are two others commanding forces. Hamis is still commanding forces near Tripoli, and Mottasam is commanding forces near Praga in the east where the oil refineries are.

So those two are going to fight with their father. So, you know, it's a big family. I don't think any of them would betray him. The three who got caught, they got caught by surprise. They did not count on the idea that the country - that Tripoli would actually fall that quickly. Actually, most of us were surprised by the speed of which Tripoli has fallen.

PHILLIPS: Mr. Saad, please stay with me. Our Wolf Blitzer is with us out of Washington. Wolf, I know you want to weigh in.

BLITZER: I just have a quick question. Saif al-Islam. He's been captured by the rebels right now. Do you honestly believe they'll hand him over to the International Criminal court in the Netherlands for trial there? Or will they seek revenge and try him in Libya?

SAAD: The understanding I get from Benghazi is no way will they surrender him to the ICC. Because even when ICC issued the order for his arrest, many within TNC and Libyan population said no way, we wanted to try him ourselves. He killed us. He didn't kill anybody outside of Libya, in their mind. Of course, he did. But in their mind, the atrocities they committed in Libya, he and his sons -- if Gadhafi is captured alive and his other sons are captured alive, my suspicion is that they are not going to be handed over. We are going to try him in Libya, and we are going to punish them for all the crimes that they have committed.

(CROSSTALK)

BLITZER: That's my impression as well, Kyra. I think the chances of them handing over Saif al-Islam or if they get Moammar Gadhafi, handing them over to the International Criminal Court are slim. I think they're going to want to have some sort of a trial -- a speedy trial, I should say, in Libya. The people hate these Gadhafis, and they want to deal with them with Libyan justice. I suspect that will unfold sooner rather than later.

One final little point. Let me ask you this, sir. They didn't release -- Libyan state television, which was still under the control of the Gadhafis last night -- they released an audio statement from Moammar Gadhafi in which he said "I am with you here, I am in Tripoli." Do you not believe that was an authentic audio tape?

SAAF: It is an authentic audio tape. But I listened to the Arabic version of it. He said - he didn't say "I am in Tripoli." He said, "I am with you, Tripoli." He didn't say "I am in Tripoli." And that's why I am just stating to Kyra earlier that he - I have strong suspicions, because I've worked for this man for nine years. I know exactly that he had already left Tripoli. If you listen to the quality of the tapes he's been releasing the last week or so, the last couple of weeks, they're very bad quality. It doesn't mean that it is the television. No. It's the distance from which he is talking.

I am suspecting either Sabha in the south, which is a very strong hold to his tribal group, or Sirt, which is the town he was born in and he has a very strong support.

PHILLIPS: Wolf, stay with us. Abubaker Saad, former aide and interpreter to Gadhafi. Great insight, Mr. Saad. Thank you so much.

And we're going to talk about more if Gadhafi is pushed out, is knocked out of power today, well, what happens tomorrow? We're going to bring in one of our reporters who actually covered Libya for years, and we'll take a look at that next.

(COMMERCIAL BREAK)

PHILLIPS: Rebel forces battling for Tripoli. And Moammar Gadhafi's four-decade-long rule could soon by over. And if that does happen, then what?

Ben Wedeman is in Cairo. And in Washington, our Wolf Blitzer. And senior international correspondent Nic Robertson is also there. He's reported extensively on Libya.

So, Wolf, let's start with you. How involved will the U.S. be in this transition?

BLITZER: I'm sure the U.S. will be involved more robustly behind the scenes than really in front of the scenes. Remember, France and Britain, some of the other NATO allies, they have a lot more at stake in what's going on in Libya and North Africa than the United States does.

Having said that, the U.S. is the main leader of NATO, and NATO played a critical role in helping the rebels get rid of Gadhafi for all practical purposes. They launched the air strikes, the no-fly zone in March. It's continued now all this many months.

So the U.S. will be involved. But remember, Kyra and all of our viewers know this as well, the U.S. has more than its own hands full in Afghanistan and Iraq right now. The last thing it needs is to get directly involved on the ground in Libya. They'll let the French, the British and the others play a more significant role. And maybe some of the African countries, maybe some of the neighbors like Egypt or Tunisia, maybe they'll play a significant role.

And one final point. Qatar and the United Arab Emirates all of these months they played a significant role in getting rid of Gadhafi as well. What they bring is some military expertise, some military power, but they bring a lot of money to the equation. There's $33 billion or $36 billion in frozen Libyan assets that the United States controls. That money eventually will go back to the transitional authority in Libya.

So, they've got a lot of oil. They'll do fine if they can stop the looting, stop the revenge, stop the killing. Easier said than done.

PHILLIPS: And Nic, even the rebels, they'll have to reconcile their differences and help create and support a broad-based governments. I mean, even all the rebels are not on the same page.

NIC ROBERTSON, CNN SENIOR INTERNATIONAL CORRESPONDENT: Even all the rebels, as you say, not on the same page. Some very disparate views, sort of liberals, if you will, on the one hand. At least secularists and Islamists on the other hand. And that's before you bring in the equation a very broad spectrum of tribes, powerful tribes that have had power through Gadhafi's rule for a long time. There's a historic east-west split in the country, and that's how we've seen the fight play out a lot. You've had the rebel stronghold in the east, and Gadhafi has held out for the best part in the west. So you've got those issues at play.

So a disparate Transitional National Council now needing to go out and talk to people who've essentially either sat on the fence or backed Gadhafi. It's not going to be easy and it will take some time. And the trust, where is it? They'll have to build that trust that they really can share the power. And we've seen within the national transitional council the sudden killing of their military chief raises some very serious questions about their real democratic leanings. And it gives an indication of how they might deal with people who won't go along with them and play ball as they want to play ball. And that's happened as recently as the past few weeks, Kyra.

PHILLIPS: And it's also going to be tough, Ben, to avoid further civil war. BEN WEDEMAN, CNN SENIOR INTERNATIONAL CORRESPONDENT: Certainly it is. But what we've seen is certainly in the beginning of this revolt when the rebels took over, for instance, Benghazi, there was surprisingly little looting. They tended to go after the buildings that were connected with the intelligence, with the police, with the army, with really - just connected with Gadhafi.

But for instance, unlike many other countries, for instance, Iraq, where there was widespread looting in Libya, there's been relatively little. Banks were left alone, businesses were not molested in any way. So the hope is this is a much more closer-knit society than for instance, in Iraq or Egypt. It's only 6.5 million people. There is a chance they will be able to avoid the kind of chaos we saw in Iraq after the fall of Saddam Hussein. They have the resources, they have the human skills to rebuild the country. It's really up to what kind of leadership emerges.

And as Nic mentioned, it is a disparate leadership. You have people from the west, from the east. You have exiles that have come back and want to play a part in reconstructing Libya. So it really comes down to who can lead this country from a revolution to reconstruction.

PHILLIPS; Ben, Wolf and Nic. Gentlemen, please stay with me. Thanks so much.

Just after the break, we've been talking about Wall Street. It's been a horrible month.

But don't be afraid to look at the Big Board today. We actually have some good news. Dow Industrials up 135 points. We'll be right back.

(COMMERCIAL BREAK)

PHILLIPS: OK, we've got some good news before the top of the hour. Alison Kosik monitoring the numbers for us there at the New York Stock Exchange. We have a bit of a rally!

ALISON KOSIK, CNN BUSINESS CORRESPONDENT: We do. We saw the Dow jump as much as 202 points. But we're holding on to some nice gains here. In fact, all of the 30 stocks are rising.

We're also seeing something similar happen overseas. Take a look. Some of the European markets are still open. The DAX, the CAC, the FTSE, all up about one to two percent. I'll tell you what, it's a huge relief after the past four weeks that we've all been through. We watched the Dow fall more than 1,800 points over the past month. The S&P 500 down 17 percent.

So, we've got a lot of ground to make up I'd say, Kyra.

PHILLIPS: Well, what do you think? Is this the sign of possibly the rest of the week? The next couple of weeks?

KOSIK: Let me pull out my crystal ball. Just kidding. PHILLIPS: C'mon, it's all about looking into the crystal ball!

KOSIK: Isn't it? Well, we're going to look to this survey by CNNmoney. It's got a bit of an optimistic look ahead. Almost all of the economists that were surveyed, they expect the S&P 500 to end seven percent higher for this year. Now, it's not as good as they originally thought, but you know what it means? We could see significant gains from where the market is now. Because if you see where it is right now, the S&P 500 is down about 10 percent, so let's all hope they'll be right with their crystal balls. Kyra?

PHILLIPS: All right. Alison, thanks.

We've got some pretty incredible pictures from inside Green Square. We'll show you right after the break.

(COMMERCIAL BREAK)

PHILLIPS: The images of rebel forces rolling into Tripoli on Sunday are sparking celebrations across the country.

(VIDEO CLIP PLAYS)

PHILLIPS: Thousands of fighters shouted and fired their weapons in the air in Benghazi. The rebels' first stronghold, by the way. It's also the city where the current rebel government resides.

CNN's Suzanne Malveaux will talk to an iReporter who shot this video coming up in our next hour.

(VIDEO CLIP PLAYS)

PHILLIPS: That was that was the scene in Misrata, a city that came under heavy fire by Gadhafi forces for months in the early part of the conflict.

And as Gadhafi's regime began to crumble yesterday, a 19-year-old woman who lives in Tripoli who didn't want to be identified actually called in to the CNN NEWSROOM to do something she's never been able to do before -- speak freely.

(BEGIN AUDIO CLIP)

UNIDENTIFIED FEMALE (on the phone): This is the freedom we've been waiting for 42 years. We've been in prison for 42 years, not to mention the last six months where we weren't allowed to do anything here. In truth, you'd be sitting down at home one night, you don't even know what your neighbor is, whether your neighbor is with or against.

So, today when the day came, I don't even know how to explain it. We were outside of the windows screaming. No one could control the other. Everyone is screaming and realized that no one wants him, no one wants this dictator. But most of us had our phones closed because we were scared.

But there's no more fear. No more. Gadhafi is gone; we don't want him anymore. Hallas (ph), the end, game over.

(END AUDIO CLIP)

PHILLIPS: We'll have continuing coverage of developments in Libya coming up in the NEWSROOM with Suzanne Malveaux. That's going to happen right after a short break.

(COMMERCIAL BREAK)