Leaders of the EU's 27 member states have said Libya's Col Muammar Gaddafi must surrender power.
The EU held an emergency summit in Brussels to try to find a common approach to the crisis.Leaders agreed to "examine all necessary options" to protect the civilian population in Libya.
But there was no agreement on the specific idea of a no-fly zone, with Germany's Chancellor Angela Merkel, for one, saying she was sceptical.
British and French leaders had wanted the summit to draw up plans to prepare to help the Libyan rebellion, including the possibility of the no-fly zone.
This would prevent pro-Gaddafi troops launching attacks from the air - currently the primary advantage the regime's troops have as they push back the rebel forces.
The rebels had captured many eastern towns in recent weeks in an uprising that followed protests inspired by the revolutions in Egypt and Tunisia.
No-fly debate
The no-fly zone option was not expressed in the joint declaration, although it was also not ruled out.
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End Quote Gavin Hewitt BBC Europe editorThe UK prime minister had wanted a more robust European response”
- Blog: Europe wary of force
"In order to protect the civilian population, member states will examine all necessary options, provided that there is a demonstrable need, a clear legal basis and support from the region," the communique says.
France's President Nicolas Sarkozy said nobody wanted military intervention but "it is clear that Europe is sending a message and did not want to exclude this option".But this would only happen, he said, with the support of the UN Security Council, the Arab League and the Libyan (rebel) authorities.
In Washington, President Obama stressed on Friday that a no-fly zone remained a possibility and said: "We are slowly tightening the noose around Gaddafi.
"Let me be as clear as I can about the desired outcome from our perspective, and that is that Gaddafi step down," he told reporters.
"And we're going to continue to work with the international community to try to achieve that and we're going to be in close consultation with these opposition groups, as they get organised, to see how we can bring about that outcome."
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EU leaders at the summit expressed political backing for the Libyan National Council, the interim authority set up by rebels in Benghazi, but stopped short of the diplomatic recognition given to the council on Thursday by France.
There was unanimity in Brussels, though, over Col Gaddafi's position."The problem has a name: Gaddafi. He must go," said European Commission President Jose Manuel Barroso. "We have to intensify our international pressure on the current regime to step down."
European Council President Herman Van Rompuy said leaders hoped to hold a joint summit soon with the Arab League and the African Union.
The Arab League is meeting to discuss the Libyan crisis on Saturday. The African Union has already rejected any idea of foreign military intervention in Libya.
Military momentum
The summit came as forces loyal to Col Gaddafi continued to make gains.
There have been more airstrikes on the oil port of Ras Lanuf, with reports of a refinery being hit. Rebels had earlier reported government forces entering the city by boat and in tanks.
The town has been held by anti-Gaddafi forces for several days and rebels still reportedly control the inner city and residential areas.
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