MOGADISHU/WASHINGTON - Somali pirates defied international naval powers on Thursday to keep an American ship captain hostage on a lifeboat in the Indian Ocean after their first seizure of U.S. citizens.

The gunmen briefly hijacked the 17,000-tonne Maersk Alabama freighter Wednesday, but the 20 American crew retook control after a confrontation far out at sea, where pirates have captured five other vessels in a week.

Four gang members were holding the captain, Richard Phillips, on the ship's lifeboat after he apparently volunteered to be a hostage for the sake of his crew.

U.S. Vice President Joe Biden said the U.S. government was working around the clock on the crisis. But President Barack Obama's administration generally had little public comment on the standoff, with delicate negotiations under way to try to secure the captain's release.

The saga added to a long list of challenges, both at home and abroad, faced by Obama less than three months after he took office.

The Pentagon said it was seeking a peaceful solution but was not ruling out any option in freeing Phillips.

What I understand is he offered himself as the hostage to keep the rest of the crew safe, Phillips' sister-in-law, Gina Coggio, told the ABC network. That is what he would do, that's just who he is, and his responsibility as the captain.

The captain's capture and the attack on his ship has once again focused world attention on Somali piracy, as happened last year when gunmen seized a Saudi supertanker with $100 million of oil on board, and a Ukrainian ship with 33 tanks.

The attacks have been happening for years but reached unprecedented levels in 2008. Pirates are currently holding 18 vessels with a total of 267 hostages, many of them from the Philippines, according to the Mombasa, Kenya-based East African Seafarers' Assistance Program.

Reached by Reuters via satellite phone, the pirates on the lifeboat sounded desperate as they watched a U.S. warship and other foreign naval vessels close to them.

We are surrounded by warships and don't have time to talk, one said. Please pray for us.

The Danish-owned freighter's operator Maersk Line Ltd said Phillips was unharmed and securing his safe return was the firm's priority. The U.S. warship Bainbridge arrived on the scene before dawn and was in contact with the lifeboat, it added.

The Federal Bureau of Investigation (FBI) said it had been called in to assist, and its negotiators were fully engaged in resolving what Attorney General Eric Holder called the first act of piracy against a U.S. vessel in hundreds of years.

U.S. Secretary of State Hillary Clinton said the lifeboat now appeared to be out of fuel. An East African maritime group said the Maersk Alabama was on its way to Mombasa and would reach there in a couple of days.

The attack was the latest in a sharp escalation in piracy in the waters off lawless Somalia, which has been mired in civil conflict and without effective central control for 18 years.

Heavily armed sea gangs hijacked dozens of vessels last year and extracted millions of dollars in ransoms. The Saudi and Ukrainian boats fetched about $3 million each.

The phenomenon has disrupted shipping in the strategic Gulf of Aden and busy Indian Ocean waterways, delayed delivery of food aid for drought-hit East Africa, increased insurance costs and made some firms route cargoes round South Africa instead of through the Suez Canal.

The upsurge in attacks has come despite an unprecedented international naval effort against the pirates, including ships from Europe, the United States, China, Japan and others, which are patrolling off Somalia, mainly in the Gulf of Aden.

PIRATES HOLD CAPTAIN AS SHIELD

Pirates say they are undeterred and will simply move operations further out into the Indian Ocean.

The solution to the problem, as ever, is the political situation in Somalia, said analyst Jim Wilson, of Lloyds Register-Fairplay. Until there is peace on land there will be piracy at sea.

Maersk said its crew regained control of the Alabama on Wednesday when the pirates left the ship with the captain.

The ship was carrying thousands of tons of food aid destined for Somalia and Uganda from Djibouti to Mombasa, when it was attacked about 300 miles off Somalia.

We are just trying to offer them whatever we can, food, but it is not working too good, second mate Ken Quinn told CNN of efforts to secure their captain's release. He said the four pirates sank their own boat after they boarded the Alabama.

Then the captain talked the gunmen into the ship's lifeboat with him. The crew overpowered one of the pirates and sought to swap him for the captain, Quinn told CNN.

We kept him for 12 hours. We tied him up, Quinn said. They freed their captive, he said, but did not get the captain back in return.

In Somalia's Haradheere port, a pirate stronghold, an associate of the gang said they were armed and ready to defend themselves.

Our friends are still holding the captain but they cannot move, they are afraid of the warships, he told Reuters. We want a ransom and of course the captain is our shield. The warships might not destroy the boat as long as he is on board.

Pirates there said two boats full of gunmen had left the port to go and support their surrounded colleagues. We are afraid warships will destroy them before they reach the scene, one told Reuters.

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