* Gaddafi forces take crossing but rebels counter-attack
* Tunisia demands end to Libyan incursions
* Rebels say fight still on for southeast desert town
* Diesel cargo shipped to rebels
(Adds border battle, Tunis reaction, Misrata quotes)
By Lin Noueihed and Abdelaziz Boumzar
TRIPOLI/DEHIBA, Tunisia, April 28 (Reuters) - Forces loyal to Libyan leader Muammar Gaddafi battled rebels on Thursday for control of a border crossing into Tunisia, provoking an angry protest from Tunis as fighting spilled on to its territory.
Early in the day Gaddafi’s troops stormed the Dehiba-Wazin crossing on Libya’s western frontier, in what appeared to be part of a broader government offensive to root out rebel outposts beyond their eastern heartland.
Tunisia strongly condemned incursions by government forces, when Libyan artillery shells also struck the Tunisian side of the crossing, and demanded that the Libyans put a stop to them.
“Given the gravity of what has happened ... the Tunisian authorities have informed the Libyans of their extreme indignation and demand measures to put an immediate stop to these violations,” a statement from the Foreign Ministry said.
Rebels rapidly staged a counter-offensive for the border post they took only a week ago, and which controls the sole supply road for rebels in Libya’s Western Mountains.
Both sides in the civil war, where Gaddafi is fighting to prolong more than four decades of rule over the oil-producing nation, also disputed whether government forces had overrun a remote desert town in the southeast of the country.
After weeks of advances and retreats by rebel and government forces along the Mediterranean coast, fighting has settled into a pattern of clashes and skirmishes.
Nowhere was the fog of war thicker than at Dehiba-Wazin crossing.
“Fighting broke out on Tunisian territory, in Dehiba, after Gaddafi’s forces attacked the border crossing,” said Ali, a Tunisian involved in helping Libyans arriving in Dehiba, adding that the rebels had withdrawn into Tunisia.
Gaddafi’s soldiers apologised to their Tunisian counterparts for the incursion and hoisted their flag at the border, tearing down a pre-Gaddafi era flag that had fluttered for a few days.
Libyan state television said some rebels had been killed and others taken prisoner in the recapture of the border post.
The counter-attack came rapidly. “The rebels in the mountains are firing at the Libyan positions,” said Reuters cameraman Abdelaziz Boumzar.
Rebel Akram el Muradi said the battle was going the rebels’ way. “Gaddafi’s forces are going out and leaving, the Libyan freedom fighters are chasing them,” he said.
However, he admitted that the battle was not over and Boumzar, who was watching the fighting from Tunisian territory, said government soldiers were still at the post.
In the confusion, scores of vehicles headed for the border from the Tunisian side with civilians on board shouting “We’ve won! We’ve won!” but they made a swift turn back when they found Gaddafi’s forces were still there.
Loss of the crossing would cut off rebels in the Western Mountains from their only road to the outside world, making them rely on rough tracks for supplies of food, fuel and medicine.
Government troops again shelled the besieged rebel outpost of Misrata, where aid ships bring in emergency supplies and evacuate the wounded, killing at least nine civilians, one rebel spokesman said. There was no independent confirmation.
Rebel spokesman Abdelsalam said from Misrata that there had been sporadic clashes on the road to the port and shelling of residential areas. “Those areas are packed with civilians who fled the fighting in the city centre,” he said.
“The ball is now in NATO’s court. After Gaddafi’s soldiers and snipers were driven out from the city centre and Tripoli Street by the rebel fighters, their strategy has been to shell the city from the outskirts. This can only be solved by NATO.”
The Western alliance has been conducting air strikes on Libya since last month under a U.N. Security Council resolution calling for civilians to be protected.
But it has been reluctant to fire on Gaddafi’s forces in Misrata for fear of hitting civilians, although rebels said on Wednesday it had destroyed 37 military vehicles overnight.
An international aid ship, with 850 migrant workers who were evacuated from Misrata during a lull in shelling, docked in Benghazi on Thursday. The workers, mostly from Niger, were being taken to the Egyptian border for repatriation.
Gaddafi forces also took a town in the remote southeastern desert, state television reported. “Libyan forces have seized full control of the town of Kufra and purified it of the armed gangs,” it quoted a military spokesman as saying.
But rebels in their Benghazi stronghold denied the town had fallen. “Gaddafi’s forces have been shelling Kufra since this morning and in the afternoon they entered the town. But they are not in full control. The battle is not over and the situation is unclear,” said rebel spokesman Mohamed al-Muntasser.
In the Western Mountains, Zintan came under heavy fire for a second day from Russian-made missiles. “Today alone, 80 missiles hit the town. We knew they were Grad missiles by the sound they make and we checked what remained of them,” a rebel spokesman, identifying himself as Abdulrahman, said by telephone.
Gaddafi denies his forces are attacking civilians and says his opponents are Islamist militants and foreign-backed agitators who deliberately put non-combatants in harm’s way.
The U.S. Treasury has moved to permit oil deals with the rebel council in Benghazi, which is struggling to provide funding for the battle-scarred areas under its control.
Trading house Vitol has shipped at least one cargo of diesel to the rebels, easing the fuel shortage and potentially unlocking more Libyan oil for export to the West.
Libya is producing only a fraction of its pre-war output and its refineries are idle, so the rebels have been looking to clinch swap deals that involve selling oil and getting oil products in exchange. Trade sources said a diesel cargo on the tanker Delos was loaded in Malta and shipped to Benghazi just over a week ago. (Additional reporting by Christian Lowe in Algiers, Guy Desmond and Maher Nazeh in Tripoli, Deepa Babington and Alexander Dziadosz in Benghazi, Tarek Amara in Tunis, Joseph Nasr in Berlin, Sami Aboudi in Cairo, Mariam Karouny in Beirut, Stephanie Nebehay in Geneva and Jessica Donati in London; writing by David Stamp; Editing by Alison Williams)