A Libyan navy ship was hit during heavy fighting with aircraft and tanks Monday between the army and Islamist militants near the port of Benghazi, residents of the major city on Libya’s eastern Mediterranean coast said.

The battle was part of a wider conflict in the North African state where former rebels who helped oust dictator Moammar Gadhafi in 2011 are fighting for power and a share of Libya’s large oil revenues.

Army special forces, backed by troops of an ex-general, launched an offensive in the Benghazi area two weeks ago against Islamist militants blamed by Washington for a 2012 assault on the former U.S. consulate which killed the American ambassador. […]