An unidentified U.S. official told The Washington Post al-Libi was taken out by a drone strike, but White House press secretary Jay Carney refused to confirm the manner of the militant leader's death.
Carney told reporters at his daily briefing U.S. intelligence has information "that leads them to believe" al-Libi is dead.
"I can't get into details about how his death was brought about," he said. "But I can tell you that he served as al-Qaida's general manager, responsible for overseeing the group's day-to-day operations in the tribal areas of Pakistan, and he managed outreach to al-Qaida's regional affiliates.
"His death is part of the degradation that has been taking place to core al-Qaida during the past several years. And that degradation has depleted the ranks to such an extent that there is now no clear successor to take on the breadth of his responsibilities, and that puts additional pressure on al-Qaida's post-[Osama] bin Laden leader, [Ayman al-] Zawahiri, to try to manage the group in an effective way. This would be a major blow -- we believe al-Libi's death is a major blow to core al-Qaida, removing the No. 2 leader for the second time in less than a year and further damaging the group's morale and cohesion, and bringing it closer to its ultimate demise than ever before."
Carney declined to discuss what another drone strike would mean for already-tense U.S.-Pakistani relations.
The drone strike was carried out Monday in a small village outside Mir Ali, in North Waziristan province near the Afghanistan border, and Pakistanis living in the area said at least 15 others had been killed, The New York Times reported.
Al-Libi rose to No. 2 in al-Qaida after the death of bin Laden, who was killed by U.S. Navy SEALs last year, and al-Zawahiri became the terrorist group's leader.
Al-Libi had often appeared in Internet videos praising al-Qaida leaders, urging resistance and attempting to recruit new members, CNN said.
"Al-Libi is a key motivator in the global jihadi movement and his messages convey a clear threat to U.S. persons or property worldwide," said a "Wanted" statement posted on the Web site of the U.S. State Department's "Rewards for Justice" program. The program, which offers rewards for information on suspected terrorists, had offered as much as $1 million for al-Libi, a Libyan who was believed to have been in his late 40s.
CNN said al-Libi purportedly worked with others to try to establish an al-Qaida presence in Libya last year.
The U.S. government said he was captured in 2002 and imprisoned at Bagram Air Force Base in Afghanistan, but he escaped in 2005.
Monday's U.S. drone strike was the third in three days in the tribal regions of South or North Waziristan.
A senior Pakistani security official said the country continues to oppose the U.S. drone strikes, the Times reported.
"Practically speaking, the drone strikes are a big success. But strategically, they are a huge loss. They create more polarization, more enemies and are an attack on our sovereignty," he said. "We have always told the Americans that if anyone should carry out these strikes, it should be us."
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