The Obama administration, anxious to deny al-Qaida’s most dangerous offshoot more space in which to flourish, urged Yemen’s wounded president on Monday to immediately step aside and clear the way for a transfer of power aimed at averting all-out civil war.

The administration’s call came as U.S. diplomats worked with Saudi Arabian and European officials to revive a plan to replace Yemeni President Ali Abdullah Saleh with a national unity government and end violence that has killed scores of people and splintered the regime, the Yemeni military and the country’s powerful tribes.

There was no sign that Saleh, who was in Saudi Arabia being treated for a wound he sustained Friday in a rocket attack, was ready to step down. Vice President Abed Rabbo Masour Hadi told European diplomats that Saleh’s “health is improving greatly and he will return to the country in the coming days,” according to the state-run news agency.

The return of Saleh, 68, who has held power since 1978, could lead to further bloodshed, something the Obama administration is anxious to avoid. U.S. officials have soured on their onetime ally after a tumultuous four months in which pro-Saleh gunmen attacked anti-regime protesters, top military officials and diplomats defected, and street battles erupted in the capital, Sanaa, between Saleh’s forces and those of a rival tribal sheikh.

Washington is worried that al-Qaida’s local branch, al-Qaida in the Arabian Peninsula, could exploit the growing unrest to expand a sanctuary in Yemen from which to launch attacks on neighboring Saudi Arabia, the world’s biggest oil producer, and U.S. targets.

“We are calling for a peaceful and orderly transition, a non-violent transition that is consistent with Yemen’s own constitution,” Secretary of State Hillary Clinton said Monday. “We think an immediate transition is in the best interests of the Yemeni people.”

Members of al-Qaida in the Arabian Peninsula, an amalgam of Yemenis, Saudis and others, including Americans, were behind the 2000 USS Cole attack, as well as the failed 2009 Christmas attempt to bomb an airliner over Detroit and a failed 2010 plot to ship bombs disguised as printer cartridges to the U.S.

A leading member of the group is Anwar al-Awlaki, a radical cleric born in New Mexico to Yemeni parents, who has been linked to the bomb plots and who allegedly helped radicalize a U.S. Army major accused of killing 12 people and wounding 31 others in a 2009 shooting spree at Fort Hood, Texas.

Some experts think that the danger posed by the group has been overblown, especially by Saleh, who they contend used it to squeeze out U.S. financial assistance – which rose to $217 million in 2010 from $102 million 2009 – and to bolster his image as a strongman indispensible to the U.S.-led fight against terrorism.

In his latest use of that tactic, several experts said, Saleh withdrew security forces from several areas in recent weeks, including the south-central coastal town of Zinjibar, allowing Islamic extremists to seize them.

“He’s willing to do anything to stay in power,” said Princeton University professor Bernard Haykel, who pointed out that Saleh employed Islamic radicals in the past to fight political threats.

Many experts, however, agreed that al-Qaida in the Arabian Peninsula would benefit from a prolonged civil war that splintered Yemen, which was already embroiled in a northern tribal insurgency and a separatist movement in the south when massive protests demanding Saleh’s ouster began in February.

“They have the capacity to mount attacks against American interests. They’ve said they’ll do it again and the bigger the space that (the group) has to plan and mount operations against international targets, the more dangerous they become,” said Christopher Boucek of the Carnegie Endowment for International Peace.

“A failed state right next to the world’s biggest oil producer is bad.”

Until recently, the U.S. closely cooperated with Saleh. It dramatically increased U.S. aid and training for Yemen’s security forces in a bid to stabilize the impoverished country of 24 million at the southern tip of the Arabian Peninsula. Nearly 40 percent of the population lives on less than $2 a day.

But in the face of ever-widening popular protests, U.S. officials threw their weight behind an Arab-drafted transition plan that called for Saleh to turn power over to Hadi, the vice president, within 30 days, in exchange for immunity from prosecution. Hadi would lead a government comprising ruling party and opposition members until elections were held within two weeks.

Saleh refused three times to sign the plan, and the White House last week dispatched John Brennan, President Barack Obama’s chief counterterrorism adviser, to the region for consultations.

On Saturday, however, Saleh was evacuated to Saudi Arabia for treatment for a wound he suffered in a rocket attack on his palace, allowing the U.S., Saudi Arabia and European countries to revive the power transfer scheme.

Experts warned that even if he were to agree to the plan, the country’s dire economic straits could derail any chances for political stability.

“Yemen’s collapsing economy, that’s the big story,” Boucek said. “That is the source of all instability in Yemen.”

(By By JONATHAN S. LANDAY, McClatchy Newspapers. Special correspondent Adam Baron contributed reporting from Sanaa, Yemen.)