Via Financial Times

Turkish forces and allied rebel groups have closed in on a key border town as a ground offensive ordered by president Recep Tayyip Erdogan pushes into north-east Syria

An official from the Kurdish-led administration that controls the area denied the Turkish defence ministry’s claim that Ankara-aligned Syrian militants had overrun the now deserted town of Ras al-Ayn.

But images published by Turkey’s state-owned Anadolu news agency and videos posted online by extremist Syrian groups suggested that Mr Erdogan’s forces and rebel allies had reached the town’s outskirts. 

They had also reached a section of a crucial highway around 30km from the border, a Turkish official said on Saturday.

Turkey’s advances came after tense exchanges between Washington and Ankara. The Pentagon said US troops had come under Turkish fire on Friday and the Treasury secretary announced that he was drafting “very powerful” sanctions against Turkey that could be activated if needed. 

Turkey has faced an international outcry over civilian casualties and the fate of an estimated 100,000 Syrians who have fled bombing by Turkish fighter jets and ground clashes which began on Wednesday, according to the United Nations.

A Kurdish news agency reported that a hospital had been hit by shelling in Ras al-Ayn, and the UN said water supplies to 400,000 people had been badly damaged in the fighting. 

The UN confirmed the deaths of eight Syrian civilians on Thursday, but the toll is expected to be far higher. The Syrian Observatory for Human Rights said on Saturday that 21 people had been killed.

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Rockets fired from Syrian territory have killed 18 Turkish civilians and four soldiers. 

Ankara’s western allies have harshly criticised Turkey’s offensive, which is targeting Kurdish-dominated forces that Ankara says are bound up with militias who have fought a 35-year bloody insurgency inside Turkey. 

The US had armed and trained the Syrian People’s Protection Units (YPG) in order to fight jihadist group Isis in the country’s north-east, enraging Turkey. 

But Donald Trump appeared to abandon this alliance when he pulled US troops from the path of Turkey’s offensive after a phone call last Sunday with Mr Erdogan. 

Western countries fear Isis fighters will use the chaos to regroup in north-east Syria, which was at the centre of the group’s self-declared caliphate from 2014 to earlier this year. 

In a stark reminder of the risks of escalation in a conflict that has effectively left two Nato member states on opposing sides, the Pentagon said on Friday that an explosion occurred a few hundred metres away from a US outpost near the Syrian town of Kobani, where US troops are still stationed.

Turkey’s defence ministry denied hitting the US base, but said it had fired in the direction of nearby hills after its troops came under fire. It said that “every precaution” had been taken to avoiding harming the US base and had held fire after being contacted by US troops. “There was absolutely no attack on US or [anti-Isis] coalition soldiers,” it said.

Shortly before the tense exchange, Steven Mnuchin, the US Treasury secretary, warned Ankara that sanctions were being prepared. “We hope we don’t have to use them, but we can shut down the Turkish economy if we need to,” he said.

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Mr Mnuchin did not specify what would trigger sanctions. But he said Mr Trump was concerned about risks to civilians and of Isis fighters escaping. 

Five captives accused of being Isis members escaped a prison after Turkish shelling on Friday, the SDF said.

Turkey’s economy is still fragile after a previous set of Trump administration sanctions caused a painful currency crisis for Turkey last year, wiping almost 30 per cent of the value of the lira.

As well as alarming the US and Europe, the Turkish incursion has prompted growing nervousness in Moscow — a key ally of the Syrian regime that has also co-operated increasingly closely with Turkey in Syria.

Vladimir Putin, the Russian president, made his strongest warning yet against the Turkish invasion in an interview on Saturday, saying: “Syrian territory must be freed from foreign military presence and the territorial integrity of Syria must be restored in full.”