"They are going to surrender or be burned in their tanks," Sahhaf told a reporter who asked if it was not time for Iraq to surrender now US forces and tanks were on the streets of Baghdad.

"We have imprisoned them inside their tanks," said Sahhaf, speaking outside the Palestine Hotel housing journalists minutes after it came under bombardment.

Sahhaf said Iraqi forces had cut off the US invaders from their rear positions and Iraqi commandoes were preparing to "crush" them inside the capital.

The Americans "are in a state of hysteria. They imagine they can terrorize (people) by killing civilians," he said.

An AFP correspondent saw hundreds of families fleeing Baghdad Tuesday as the capital was rocked by US bombing and fighting between US and Iraqi forces.

SPACE.WIRE