* Russia, West blame each other for Annan's departure
* Security Council seen as impotent on Syria crisis
* Military airfield could be used to reinforce Aleppo
By Louis Charbonneau and Hadeel Al Shalchi
UNITED NATIONS/ALEPPO, Syria, Aug 2 (Reuters) - Former U.N. Secretary-General Kofi Annan is quitting as international peace envoy for Syria, frustrated by "finger-pointing" at the United Nations while the armed rebellion against President Bashar al-Assad becomes increasingly bloody.
As battles raged on Thursday in Syria's second city, Aleppo, between rebel fighters and government forces using war planes and artillery, U.N. Secretary-General Ban Ki-moon announced in New York that Annan had said he would go at the end of the month.
"Kofi Annan deserves our profound admiration for the selfless way in which he has put his formidable skills and prestige to this most difficult and potentially thankless of assignments," Ban said. Talks were under way to find a successor.
Annan's mission, centered on an April ceasefire that never took hold, has looked irrelevant as fighting has intensified in Damascus, Aleppo and elsewhere.
Annan blamed "finger-pointing and name-calling" at the U.N. Security Council for his decision to quit but suggested his successor may have better luck.
Russia, the United States, Britain and France began pointing fingers at one another over who was responsible for Annan's sudden announcement he would depart. One senior council diplomat said it was now time to acknowledge the "utter irrelevance of an impotent Security Council" on Syria.
Syria expressed regret that Annan was going.
Annan suggested that the continued arming of all sides in the conflict and the Security Council deadlock had undermined his ability to pursue a diplomatic solution.
"The increasing militarization on the ground and the clear lack of unity in the Security Council, have fundamentally changed the circumstances for the effective exercise of my role," Annan told reporters.
In an editorial published on the Financial Times' website, Annan said Russia, China and Iran "must take concerted efforts to persuade Syria's leadership to change course and embrace a political transition" -- meaning the departure of Assad.
"It is clear that President Bashar al-Assad must leave office," Annan said.
Annan wrote that Western powers, the Saudis and Qatar must start "pressing the opposition to embrace a fully inclusive political process - that will include communities and institutions currently associated with the government."
Ban's spokesman, Martin Nesirky, declined to comment on who might replace Annan but said a decision could come soon.
Russian President Vladimir Putin, a strong supporter of Assad, said he regretted Annan's decision to step aside and referred to him as a "brilliant diplomat."
Moscow's U.N. ambassador, Vitaly Churkin, suggested to reporters in New York that Western powers that had opposed "reasonable and balanced proposals" in the Security Council had undermined Annan's peace efforts from the start.
China expressed regret late on Thursday over Annan's resignation and said it was open "towards any proposals that would help promote a political solution to the Syria issue."
The White House pinned the blame squarely on Moscow and Beijing, which together vetoed three resolutions intended to increase the pressure on Assad, thereby undercutting Annan.
"Annan's resignation highlights the failure at the United Nations Security Council of Russia and China to support resolutions, meaningful resolutions, against Assad that would have held Assad accountable," White House spokesman Jay Carney told reporters aboard Air Force One.
British Foreign Secretary William Hague echoed that view.
"We understand Annan's frustration that, due to vetoes in the Security Council, the international community was unable to give him the support that he needed and requested," Hague said in a statement.
Hague reiterated that Annan's six-point peace plan for Syria was still the best option for securing an end to the conflict. French Ambassador Gerard Araud, Security Council president this month, shared that view.
Washington, U.N. diplomats say, has been convinced that the Security Council cannot play a meaningful role in the Syria crisis since Russia and China first vetoed a Western- and Arab-backed resolution in October. But it reluctantly supported European efforts to try to get the council to take action.
U.S. Ambassador Susan Rice issued a statement that made no mention of the United Nations playing a role in resolving the Syria conflict.
"We will continue to work urgently with our partners in the international community - including the over 100 countries in the Friends of the Syrian People - to accelerate the transition, provide support to the opposition, and meet the increasingly grave humanitarian needs of the Syrian people," Rice said.
Council diplomats have said privately the United States and Gulf Arab states have become increasingly frustrated in recent weeks with what they saw as Annan's dogged commitment to diplomacy at a time when they believe all avenues for dialogue with Assad have been exhausted.
France's U.N. envoy, Araud, said the council appeared to be "irreconcilably" deadlocked but that it would be dangerous for countries to go outside the United Nations to resolve the Syria conflict.
But that is already happening. The United States, other Western powers, Saudi Arabia and Qatar are increasing support for the rebels, U.N. diplomats say, and are reconciling themselves to the view that Syria's civil war will be long and bloody.
Separately, Araud said the U.N. observer mission would likely "disappear" on Aug. 19, the day its recently renewed mandate expires.
BATTLE FOR ALEPPO RAGES
In Syria, the fight for Aleppo, the latest battlefield, intensified. Rebels turned the gun of a captured tank against government forces, shelling an air base north of the city.
Assad's troops bombarded the strategic Salaheddine district in Aleppo itself with tank and artillery fire supported by combat aircraft, while rebels tried to consolidate their hold on areas they have seized.
In the capital, Damascus, troops overran a suburb on Wednesday and killed at least 35 people, mostly unarmed civilians, residents and activist organizations said.
The fighting for Syria's two biggest cities highlights the country's rapid slide into full-scale civil war 17 months after the peaceful street protests that marked the start of the anti-Assad uprising.
The head of the U.N. peacekeeping department, Herve Ladsous, confirmed to reporters on Thursday that Syria's rebels now had heavy weapons.
World powers have watched with mounting concern as diplomatic efforts, including Annan's mediation effort, have faltered, and violence that has already claimed an estimated 18,000 lives worsens.
Activists and residents in the central city of Hama said on Thursday that Syrian forces killed at least 50 people during clashes with rebels there.
Also on Thursday, opposition sources said Syrian army helicopter bombardment killed 16 rebels from the same family in the southern Hauran Plain, a strategic region that links Damascus with Jordan.
The rebels' morale was boosted when they turned a government tank's gun on the Menakh airfield 35 km (22 miles) north of Aleppo, a possible staging post for army reinforcements and a base for war planes and helicopter gunships.
Reuters correspondents heard heavy weapons fire on Thursday morning from Salaheddine in southwest Aleppo, a gateway to the city that has been fought over for the past week.
Heavily armed government troops are trying to drive a force of a few thousand rebel fighters from the city in battle whose outcome could be a turning point in the conflict.
Aleppo had long stayed aloof from the uprising, but many of its 2.5 million residents are now caught up in battle zones, facing shortages of food, fuel, water and cooking gas. Thousands have fled and hospitals and makeshift clinics can barely cope with casualties after more than a week of combat.
In New York, the U.N. General Assembly was expected to vote on Friday on a resolution drafted by Saudi Arabia that backs the rebels.
Russia, which has consistently supported Syria at the United Nations, said it would not back the resolution because it was unbalanced and would encourage rebels to keep fighting.