Libyan rebels believe they have found and surrounded dictator Moammar Gadhafi.

An intense battle with government loyalist is still underway at an apartment complex near Gadhafi's compound.

About 1,000 rebels bombarded the buildings Thursday. Fierce gunfire and explosions soon followed. Witnesses said bullet-ridden bodies were on the ground and the sewers ran with blood.

A rebel commander said there were rumors that at least one of Gadhafi's sons might be in the buildings.

Hundreds of rebels gathered again in Tripoli's Green Square Wednesday night to celebrate their growing control of the capital and the perceived end of the Gadhafi regime.

"Members of the council are now moving one by one from Benghazi to Tripoli," said Mansour Seyf al-Nasr, the Libyan opposition's new ambassador to France.

However, sniper fire is still a reality in Tripoli and Gadhafi is still at large.

A group is now offering $2 million for anyone who brings Gadhafi in, dead or alive.

Meanwhile, the head of Libya's rebel cabinet is embarking on a European diplomatic tour to secure the release of at least $5 billion in frozen assets.

Transitional National Council head Mahmoud Jibril arrives in Italy Thursday to meet with Italian Prime Minister Silvio Berlusconi.

Libya's opposition insists they need the funds to pay state salaries, maintain vital services, and repair critical oil facilities.