Tribal negotiations are ongoing with Yemeni authorities to free within "two days" an Italian embassy security agent kidnapped in Sanaa over the weekend, his abductor told a local news website on Wednesday.

"There is tribal mediation... and hopefully the matter will be resolved tonight, tomorrow, or over the coming two days," Ali Naser Huraidkan said according to a private Internet site close to Yemeni tribes, marebpress.net.

The Czech embassy in Damascus will represent U.S. interests in Syria after Poland, which had been taking on that function for the Americans after they pulled out in February, withdrew its diplomats last week.

"Following a request from the United States, the Czech Republic has agreed to represent U.S. consular interests in Syria," a Czech foreign ministry statement said Wednesday. Talks on "technical details" are underway, it added.

Syria's rebels said on Wednesday that a government-in-exile headed by a splinter group of dissidents was "stillborn" and that it did not represent the opposition's demands.

The rebels' comments came a day after exiled dissident Haytham al-Maleh, 81, said in Cairo he had been tasked by a coalition of independent dissidents to create a government-in-exile based in the Egyptian capital.

Syria's military has used fighter jets to fire on Aleppo, the country's second city, the U.N. Supervision Mission in Syria (UNSMIS) spokeswoman told Agence France Presse on Wednesday.

"Yesterday they (U.N. observers) saw firing from a fighter aircraft" on Aleppo, said Sausan Ghosheh. "They are jets."

Egypt's Prime Minister Hisham Qandil has selected a new government in which the finance and foreign ministers from the outgoing cabinet will retain their posts, state television reported on Wednesday.

Qandil was meeting with the ministers, including Foreign Minister Mohammed Kamel Amr and Finance Minister Mumtaz al-Said, a day before he was to formally unveil the cabinet on Thursday, the Nile News channel reported.

U.S. Defense Secretary Leon Panetta said Wednesday that Iran must either negotiate acceptable limits on its nuclear program or face the possibility of U.S. military action to stop it from getting the bomb.

Panetta made his remarks outside the city of Ashkelon in southern Israel, with an "Iron Dome" anti-rocket defense system as a backdrop.

Rebels in Syria have now set their sights on seizing intelligence branches in the country's commercial capital of Aleppo after taking three police stations there, a rebel commander told Agence France Presse on Wednesday.

The rebels seized three police stations on Tuesday: in Bab al-Nayrab, the southern district of Salhin and in Hanano. Rebel leader Ferzat Abdel Nasser called the takeovers "a small victory that is good for morale."

July was the deadliest month in Iraq in almost two years, with 325 people killed in attacks, official figures released on Wednesday showed.

The statistics compiled by the health, interior and defense ministries showed that 325 people -- 241 civilians, 40 police and 44 soldiers -- were killed nationwide during the month.

Egypt's President Mohammed Morsi has not sent a letter to his Israeli counterpart Shimon Peres, state media reported on Wednesday.

The Israeli president's office had said on Tuesday that the Islamist leader wrote to Peres pledging to revive the Israeli-Palestinian peace talks.

A bomb blast shook the department of military intelligence in the eastern city of Benghazi early Wednesday, causing material damage to the building, Libyan security sources said.

"The department of military intelligence was bombed," a senior security officer told Agence France Presse, adding that the level of damage to the two-storey building suggested it was hit by an improvised explosive device.