SINGAMARAJA

RAS LANOUF, Libya – Libya's opposition battled for military and diplomatic advantage against Moammar Gadhafi's regime on Thursday, winning official recognition from France but losing ground to government forces outside a strategically vital oil port.

Gadhafi's forces advanced on the port of Ras Lanouf, hitting buildings with tank shells and driving lightly armed opposition fighters back into the city.

Shells fell near a hospital in the city and hit a series of residential buildings as Gadhafi's tanks moved further along Libya's main Mediterranean coastal road than they have been since the rebels seized most of the country's east.

An opposition fighter with a Kalashnikov rifle said he had fled the frontline outside Ras Lanouf to move deeper into the rebel-controlled territory.

"We don't have any heavy weapons," he said. "There are people with heavier weapons."

Another opposition fighter in civilian clothes stood at a checkpoint inside the city and called for those with heavy weapons to head to the front.

France became the first country to formally recognize the rebels' newly created Interim Governing Council, saying it planned to exchange ambassadors after President Nicolas Sarkozy met with two representatives of the group based in the eastern Libyan city of Benghazi.

"It breaks the ice," said Mustafa Gheriani, an opposition spokesman. "We expect Italy to do it, and we expect England to do it."