Honduras faces expulsion from bloc

A spokesman for the court said it had told Jose Miguel Insulza, head of the Organisation of American States, that the removal of Zelaya in a coup last Sunday was "irreversible," in defiance of an OAS demand he be reinstated.

Insulza was taking part in talks here with politicians, legal and religious figures as the OAS warned Honduras would face expulsion by a Saturday deadline if it did not reinstate Zelaya.

That move appeared more likely following Friday's talks.

Insulza "thinks they will vote to suspend (Honduras)," one diplomat said, after the OAS chief met with the G16 group of donors to the Central American nation, which includes the United States, the World Bank and Japan.

"(He) told us he thought it was a crisis that would last a long time."

‘No one wants to budge’

Insulza said that "no one wants to budge," according to another diplomat, shortly after a spokesman for the Supreme Court gave its verdict.

The OAS chief was due to return to Washington on Saturday, where the regional body would vote on whether to suspend Honduras from the 35-nation group, a threat last carried out on Cuba in 1962, diplomats said.

Diplomats said Insulza had dismissed any idea of negotiating with the instigators of the coup and did not meet with the attorney general.

The leaders who deposed Zelaya said they may consider holding early elections to end the impasse but at demonstrations held in the capital on Friday they remained defiant.

"I'm president of all Hondurans," shouted interim leader Roberto Micheletti to a crowd of thousands of supporters. He was sworn in by Congress hours after Zelaya was ousted.

Thousands of Zelaya supporters demonstrated nearby in Tegucigalpa.

Zelaya sent to Costa Rica

Soldiers bundled Zelaya into a plane at dawn last Sunday and sent him to Costa Rica after a dispute with the country's courts, politicians and army over his attempts to change the constitution to allow him to run for a second term.

The growing demonstrations, a freezing of international aid and recalls of foreign ambassadors have since shaken the country.

In the first unrest in three days, the army clashed with demonstrators in northern Honduras on Thursday.

With their lives also disrupted by night-time curfews, which suspend some freedoms guaranteed by the constitution, as well as media blackouts and reported detentions, the 7.5 million inhabitants of one of Latin America's poorest countries have become increasingly frustrated.

Return date unknown

Nicaraguan President Daniel Ortega said on Friday that Zelaya could return on "Saturday or more likely Sunday."

Zelaya had earlier said from Panama that a string of personalities would join him when he returned to the country, including Nobel Prize winners and presidents, although he did not mention a return date.

The international community has placed pressure on Honduras, including aid freezes from the Inter-American Development Bank and the World Bank.

The United States, a key ally, has indicated it may follow suit, saying it would wait until Monday before making a decision.

The Honduran finance minister lamented in Chile on Friday that between $US300 and $US450 million ($A379.36 and $A569.04 million) of foreign aid was frozen.

"This irregular situation in my country puts social investment programs in a very precarious situation," Rebeca Santos said.

Venezuela's President Hugo Chavez, Zelaya's key backer, announced that Caracas was suspending shipments of oil to Honduras, which he said would drive up petrol prices.

All EU countries with embassies in Honduras have withdrawn their ambassadors and Central American countries and Latin American leftists have announced similar measures, as has Colombia.

The Pentagon has suspended all military activities with Tegucigalpa until further notice.