ADEN: Loyalists of Yemen's exiled president recaptured the airport in second city Aden Tuesday sealing a four-month battle with Iran-backed rebels with Saudi-led air and naval support, military sources said.
Fighting in the port city escalated as U.N. chief Ban Ki-Moon expressed disappointment over the failure of a U.N.-declared ceasefire to take hold over the weekend.
The retreat by the Shiite rebels came as Iran - regarded as their main foreign supporter - struck a historic nuclear deal with world powers that was seen as bringing the main Shiite power in from the cold but setting limits to its regional ambitions.
Leading Sunni power Saudi Arabia has been deeply concerned about Iranian influence in its impoverished southern neighbor and has led a devastating air campaign since March against the rebels and their allies in the armed forces.
Saudi-led warships off the coast pounded the rebels as they pulled back from positions in Aden they had held since forcing President Abed Rabbou Mansour Hadi into exile in Riyadh in March.
Hadi was "personally supervising the operation" dubbed "Operation Golden Arrow for the Liberation of Aden," his chief of staff Mohammad Marem said.
Aden airport had been in the hands of the rebels since soldiers of the 39th Armored Brigade defected on March 25.
The Houthi Shiite rebels and their allies have since gone on to seize the presidential palace and Aden's main commercial port.
Military sources in Aden said pro-Hadi fighters were now benefiting from ground support from Yemeni forces recently trained in Saudi Arabia, in addition to sophisticated weapons delivered by the coalition.
"Forces recently trained in Saudi Arabia are strongly participating in the fighting alongside the Popular Resistance," said one source, referring to the southern militia that have been the mainstay of support for Hadi so far.
Retaking the airport of Aden is the first significant achievement for pro-Hadi fighters since the embattled president fled.
The rebels overran the capital Sanaa unopposed in September and went on to seize much of the rest of the country aided by troops still loyal to Hadi's ousted predecessor Ali Abdullah Saleh.
Aden's oil refinery - Yemen's biggest - was ablaze Tuesday after being hit by rockets during the fighting for the city.
Hadi loyalists blamed the rebels for the blaze. The rebels blamed a Saudi-led airstrike.
The fighting raged despite a U.N.-declared six-day ceasefire that was supposed to take effect shortly before midnight (2100 GMT) Friday.
The U.N. chief said he was "very much disappointed" by the failure of the truce but retained hope the fighting might still end, his spokesman said.
He added: "We continue to reiterate our call for an unconditional humanitarian pause."
"We have not lost hope and discussions are ongoing," Stephane Dujarric said.
He also defended the decision to call the ceasefire, saying U.N. envoy Ismail Ould Cheikh Ahmed "had received the commitments he felt were necessary for us to come out with this announcement".
The United Nations has declared Yemen a level-3 humanitarian emergency, the highest on its scale, with nearly half the country facing a food crisis.
More than 21.1 million people - over 80 percent of Yemen's population - need aid, with 13 million facing food shortages, while access to water has become difficult for 9.4 million people.
The U.N. says the conflict has killed more than 3,200 people, about half of them civilians, since late March.