WASHINGTON - President Barack Obama on Friday warned the United States was "almost out of time" to make a deal to raise the nation's debt ceiling, insisting that a compromise was within reach.

"This is not a situation where the two parties are miles apart," Obama said in a White House statement, calling for a bipartisan deal and urging Americans to keep up the pressure on Republicans and Democrats to compromise.

"What's clear now is that any solution to avoid default must be bipartisan. It must have the support of both parties that were sent here to represent the American people. Not just one faction," Obama said.

US Republican leaders will scramble to rescue their budget deficit-cutting plan on Friday after conservatives mounted a rebellion that heaped uncertainty on efforts to avert a catastrophic debt default.

House of Representatives Speaker John Boehner's failure to round up enough support for his plan on Thursday exposed a rift in the Republican Party that is hampering efforts to reach a compromise to raise the US debt ceiling before a deadline on Tuesday.

President Barack Obama said that unless Democrats and Republicans strike a deal, the government will start running out of money to pay all its bills on Tuesday, a once unthinkable prospect that is increasingly unnerving investors.

With only four full days left, the Treasury could unveil an emergency plan as early as Friday explaining how the government would function and pay its obligations if Congress does not agree to raise its borrowing limit beyond $14.3 trillion.

Despite warnings of dire economic consequences, lawmakers appear as far apart as ever as conservative Republicans demand an end to what they say is out-of-control government spending and Democrats seek to protect spending on social programs.

Boehner's plan, which would cut spending by about $900 billion and raise the debt ceiling for a few months, is sure to be rejected by the Democratic-controlled Senate, but could factor into an eventual compromise.

His inability to win quick passage in the Republican-run House could weaken his position at the bargaining table.

Top Senate Democrat Harry Reid wants to raise the debt ceiling by enough to kick the crisis beyond the November 2012 presidential election.

Reid indicated late on Thursday that

he may advance his own bill, which cuts spending by $2.2 trillion over 10 years, in the Senate rather than use Boehner's proposal as the basis for a compromise.

House Republicans were due to meet at 10 am local time on Friday to discuss a way forward after last-minute arm-twisting by Boehner failed to overcome opposition within his party and forced him to abandon plans for a vote on Thursday night.

The setback raised doubt over his ability to deliver enough votes in any compromise deal with the Senate.

Reuters-AFP