At least four people were killed Friday in Yemen’s southern flashpoint of Taiz, as the prime minister-designate Mohammed Basindwa warned that the violence could derail a deal on peaceful power transfer in the impoverished Arabian Peninsula country.

Online activists said that seven others were injured when forces loyal to outgoing President Ali Abdullah Saleh shelled residential areas in Taiz, Yemen’s second biggest city, for the second successive day.

On Thursday, battles between soldiers and anti-government gunmen in Taiz killed at least 16 people, according to medical sources.

Taiz has been a focal point in the anti-Saleh protests since they started in February.

In the capital Sana’a, thousands of anti-government protesters Friday continued to camp in Change Square, refusing the Gulf-sponsored deal which grants Saleh, his family, and close aides immunity from prosecution. They accuse him of involvement in crimes against humanity.

The deal signed by Mr. Saleh and opposition leaders, including Basindwa, in Saudi Arabia last month appears to have failed to end 10 months of bloodshed in the country. Under the terms of the deal, Mr. Saleh is to transfer power to Hadi within 30 days, followed 90 days later by a presidential election.

Basindwa called Hadi on Thursday and urged him to order the army to stop the “massacre” in Taiz, saying the opposition would reconsider the deal if the violence continues.

“If this doesn’t happen, we will reconsider our position,” said Mr. Basindwa. The opposition, which comprises six parties, said it would now announce the cabinet line-up on Sunday.

Under a power-sharing agreement, Mr. Saleh’s ruling party will have the defence, foreign affairs and oil portfolios, while opposition will get the ministries of the interior, information and finance.

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