Rebel fighters in South Sudan say they have re-taken control of Bentiu, the capital of oil-producing Unity State.
A spokesman for former vice president and opposition leader Riek Machar says fighters recaptured Bentiu on Tuesday.
In a VOA interview , spokesman James Gatdet Dak said the opposition is attempting to shut down all oil production in South Sudan because it does not want the government to use revenues from oil sales to buy weapons.
He said opposition fighters have given oil companies in Unity and Upper Nile states one week to shut down their operations.
Army spokesman Philip Aguer confirmed fighting in Bentiu but did not say the town has been over-run by rebels.
"There is still fighting on in Bentiu and we are waiting for reports from our field command. There is still fighting over in Bentiu ."
Joseph Contreras, a spokesman for the United Nations mission in South Sudan, says five foreign oil workers were injured on Monday after they were caught up in attacks on an oil refinery about 30 kilometers from Bentiu. He says U.N. peacekeepers evacuated workers from the site.
Gatdet says some of the people who have sought refuge at a U.N. facility in the region have been celebrating the alleged rebel take-over.
"The civilians in the U.N. compound have come out dancing, singing, ululating and welcoming the rebels inside the town."
South Sudan's conflict erupted in mid-December after the government accused Machar of leading an attempted coup.
Fighting at an army headquarters in the capital, Juba, set off weeks of deadly clashes that have left thousands dead and prompted more than one million to flee their homes.
The government and rebels signed a cease-fire agreement in January, but fighting has continued. Peace talks in Addis Ababa have made little progress.