SANAA Western and Gulf diplomats failed on Sunday to persuade Yemeni President Ali Abdullah Saleh to sign a deal that would ease him out of power and make him the third Arab leader ousted by popular protests, diplomats said.
Saleh, a political survivor who had already twice backed out of signing at the last minute, was under intense diplomatic pressure to seal the Gulf-brokered deal to end three months of protests against his rule.
"It failed," one of the diplomats told Reuters. A Gulf diplomat said the Gulf Cooperation Council bloc of Yemen's wealthy oil-exporting neighbours may withdraw its initiative as a result.
The deal would have given Saleh immunity from prosecution, ensuring a dignified exit after nearly 33 years at the helm of the Arabian Peninsula state, located on a shipping lane through which 3 million barrels of oil pass every day.
Hundreds of armed Saleh loyalists rallied against the deal on Sunday, blocking main roads and preventing a Gulf mediator from leaving the United Arab Emirates embassy to head to the presidential palace in Sanaa for the signing, witnesses said.
Armed Yemeni government loyalists trapped Arab and Western diplomats inside an embassy on Sunday to block the signing.
The United States and Saudi Arabia, both targets of foiled attacks by al Qaeda's Yemen wing, are keen to end the Yemeni stalemate to avert deeper chaos that could give the militant network more room to thrive.
More than 170 protesters have been killed in a crackdown on demonstrations, part of the wave of uprisings across North Africa and the Middle East that swept aside the leaders of Tunisia and Egypt.
(Writing by Cynthia Johnston; editing by Alison Williams)