Yemen rebels say Saudi troops fired on border town

SANAA (Reuters) - Shi'ite rebels in Yemen accused Saudi forces on Monday of firing into a northern border town in support of the Yemeni government's offensive against them.

"The Saudi forces near the Hasama border region hit the Hasama market with heavy machinegun fire while the market was full of people," the rebels, known as Houthis after their clan leaders, said in a statement.

A security official denied that Saudi forces had fired on Hasama and said Saudi Arabia had no role in the war.

The insurgents, who say they are fighting political, economic and religious marginalisation, have often accused neighbouring Sunni power Saudi Arabia of fighting on the side of Yemeni President Ali Abdullah Saleh.

"This reveals the increasing Saudi interference in Yemen's internal affairs," it said.

Saudi Arabia, the world's biggest oil producer, and the United States fear the conflict in Yemen's northern provinces and a separatist movement in the south will enable al Qaeda to establish a stronger foothold in the Arabian Peninsula state.

In an interview with Saudi-owned MBC television aired on Sunday, Saleh said Saudi Arabia backed Yemeni unity but did not interfere.

He vowed to crush the rebels, who he said last week would be defeated within days, and accused al Qaeda, a Sunni group, of backing the Houthis.

"From the reports we have, they back each other. The Houthis support al Qaeda and al Qaeda support the Houthis," he said.