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 BRUSSELS—International efforts to tighten pressure on Syria intensified Monday, with the European Union placing new sanctions on Damascus while foreign ministers predicted President Bashar al-Assad was starting to lose his grip on power. 
 
 The EU confirmed it was placing an asset freeze and travel ban on 26 people—mainly army, security and intelligence officials. The EU also tightened its arms embargo and targeted three companies including Syria's flagship airline. All three companies are "closely linked to the Assad family," U.K. Foreign Secretary William Hague said. 
 
 The EU "strongly condemns the ever-increasing use of force by the regime, including use of heavy ... ||||| BEIRUT (Reuters) - Western states expressed alarm after Syria acknowledged for the first time that it has chemical and biological weapons and said it could use them if foreign countries intervene. 
 
 A week of unprecedented fighting inside the capital Damascus, including a bomb attack that killed four of President Bashar al-Assad's closest advisers, has transformed the 16-month uprising and dramatically escalated international pressure on Assad. 
 
 Damascus residents said the capital was relatively quiet in the early hours of Tuesday after a day of fighting that saw government troops storm a neighborhood. 
 
 Defying Arab foreign ministers who on Sunday offered Assad a "safe exit" if he stepped down, the Syrian leader has launched fierce counter-offensives, reflecting his determination to keep power as the uprising enters its most violent phase. 
 
 Foreign Ministry spokesman Jihad Makdissi said the army would not use chemical weapons to crush rebels but could use them against forces from outside the country. 
 
 "Any chemical or bacterial weapons will never be used ... during the crisis in Syria regardless of the developments," Makdissi said. "These weapons are stored and secured by Syrian military forces and under its direct supervision and will never be used unless Syria faces external aggression." 
 
 Damascus has not signed a 1992 international convention that bans the use, production or stockpiling of chemical weapons, but officials in the past had denied it had any stockpiles. Washington and other Western capitals rushed to warn Syria against making any threats to use such weapons. 
 
 "Given the escalation of violence in Syria, and the regime's increasing attacks on their people, we remain very concerned about these weapons," White House spokesman Tommy Vietor said. 
 
 A U.S. State Department spokeswoman said warnings against using chemical weapons extended not only to the Syrian government but to rebels and any militants who might try to obtain them. 
 
 "The warnings that we have given with regard to safeguarding this kind of absolutely horrific and dangerous weapon have been made to regime, to opposition, to anybody who might get their hands on them," she said. 
 
 Britain, Germany and other countries also said it was unacceptable for Syria to say it might use chemical arms. U.N. Secretary General Ban Ki-moon said he was very concerned Syria may be tempted to use unconventional weapons. 
 
 Western countries and Israel have expressed fears chemical weapons could fall into the hands of militant groups as Assad's authority erodes. Israel has publicly discussed military action to prevent Syrian chemical weapons or missiles from reaching Assad's Lebanese Shi'ite militant allies Hezbollah. 
 
 The Global Security website, which collects published intelligence reports and other data, says there are four suspected chemical weapons sites in Syria: north of Damascus, near Homs, in Hama and near the Mediterranean port of Latakia. Weapons it produces include the nerve agents VX, sarin and tabun, it said, without citing its sources. 
 
 Abdelbasset Seida, head of the Syrian National Council opposition group, said: "A regime that massacres children and rapes women could use these types of weapons. 
 
 "The technical infrastructure may not be suitable, but as I said, such a step could be expected from this murderous regime. The international community must prevent this," he told reporters after meeting Turkey's foreign minister in Ankara. 
 
 Arab League ministers meeting in Doha urged the opposition and the rebel Free Syrian Army to form a transitional government, Qatari Prime Minister Sheikh Hamad bin Jassim al-Thani told a news conference. 
 
 Makdissi rejected the call for Assad to step down as a "flagrant intervention" in Syria's internal affairs. "We regret that the Arab League stooped to this immoral level," he said. 
 
 On Monday the army shelled rebel forces in the northern city of Aleppo and stormed the southern Damascus neighborhood of Nahr Aisha, breaking into shops and houses and burning some of them, activists said. 
 
 Video showed dozens of men in green army fatigues massing in the neighborhood, which looked completely abandoned. Men carrying machineguns and rocket-propelled grenade launchers knocked and then kicked down doors and climbed through windows. 
 
 Assad's forces have reasserted control over several Damascus areas since they seized back the central Midan district on Friday, 48 hours after a bomb attack killed four of Assad's closest security officials. 
 
 "The regime strategy is to continue to confront the opposition, this time with much broader military response," said Ayham Kamel, Middle East analyst at Eurasia Group consultancy. 
 
 "The expectation that the regime is out of firepower or collapsing right now is misplaced." 
 
 But Assad's forces have lost ground outside cities, ceding control of four border posts on the Turkish and Iraqi borders. 
 
 Sky Television footage from the town of Azaz close to the border with Turkey showed rebel fighters parading through streets firing triumphantly after a prolonged battle with government forces. 
 
 In Aleppo, activists said thousands of residents fled the rebel-held districts of Al-Haideriya, Hanano and Sakhour after army shelling and clashes between rebels and government forces in which activists said three government tanks were destroyed. 
 
 A video posted by activists showed families crammed into taxis, vans and the back of trucks trying to flee. Dozens of other families set out on foot, carrying plastic bags with their belongings. 
 
 "This is a large scale hit-and-run battle. The whole point is to bleed the regime dry. It is a very long fight, and it will be especially long in Aleppo," said a spokesman from the Islamist rebel group the Battalions for the Free Men of Syria. 
 
 DAMASCUS FIGHTING 
 
 The fighting in Damascus, Aleppo and the eastern city of Deir al-Zor has been some of the fiercest yet and showed Assad's determination to avenge last Wednesday's bomb attack, the most spectacular blow of the uprising. 
 
 Activists reported clashes on Monday in the Damascus districts of Qadam and Kafr Sousseh. Rebel sources say the guerrilla fighters in the capital may lack the supply lines to remain there for long and may have to make tactical withdrawals. 
 
 In the northeast district of Qaboun, where Assad's forces pushed fighters back in recent days, most streets were empty, said a resident reached by telephone who visited the area from another part of Damascus. A few people were returning to check on homes, some of which were destroyed. 
 
 "I came just to pick up some of my family's belongings, I am not returning for now," one woman told the visitor at her empty-looking four-storey building. 
 
 Groups of men were removing bodies from underneath the rubble of one building. "We have removed 25 bodies so far from this area, we are burying them quickly," one said. 
 
 An activist said 24 bodies had been found outside the capital in the Daraya district of the countryside on Monday, and said they appeared to be fighters who had been executed. 
 
 The accounts could not be verified independently; Syria restricts access by journalists. 
 
 The Syrian Observatory for Human Rights, which compiles reports from anti-Assad activists, said 1,261 people had been killed across Syria since last Sunday when fighting escalated in Damascus, making it by far the bloodiest week in an uprising activists say has claimed at least 18,000 lives. 
 
 (Additional reporting by Suleiman al-Khalidi in Antakya; Writing by Dominic Evans; Editing by Peter Graff and Michael Roddy)
– Despite recent reports that Syria may be preparing to use its chemical weapons, a foreign ministry spokesperson today tried to assure the world that they will not be used on the Syrian people—officially acknowledging for the first time that the country actually has such weapons, reports Reuters. "Any chemical or biological weapons will never be used ... in the Syrian crisis, no matter what the internal developments are," he said. But they could still be used: "These weapons are stored and secured by Syrian military forces and under its direct supervision and will never be used unless Syria faces external aggression." Meanwhile, though rebels were encouraged by the assassination attack last week that killed four regime officials in Damascus, Syrian troops have now driven rebels out of the city's Mezzeh district, yesterday executing at least 20 unarmed men there, Reuters reports. Violence is also raging in Aleppo, Syria's biggest city, and Deir al-Zor. The EU issued new sanctions against Syria today, the Wall Street Journal adds; those include an asset freeze and travel ban on select Syrians, and a tighter arms embargo. The Arab League promised President Bashar al-Assad a "safe exit" if he steps down now.