Kabul, August 31 (RHC)-- The Taliban launched a massive offensive against Afghanistan’s strategic city of Kunduz in the midst of reports that the militant group and the U.S. are close to a "peace" deal.  Witnesses said on Saturday gunfire could be heard across Kunduz, the capital of Kunduz province.

Heavy fighting has been going on in Kunduz city since Taliban fighters mounted attacks from several directions on Friday night.  The Taliban claimed they had captured several important buildings, while Afghan security officials insisted they had enough manpower on the ground to repel the attack.

“Security forces are repelling the Taliban attack on some parts of Kunduz city. Their top priority is to protect the civilians,” Government spokesman Sediq Sediqqi wrote in a Twitter posting.

Afghanistan’s Interior Ministry said at least 34 Taliban terrorists had been killed during ground and air operations in three areas of the city and that purging operations were still underway.

Reports said electricity and most telephone services were cut and residents were sheltering in their houses.  "The city is completely empty, shops are locked, people aren't moving and light and heavy weapons can be heard in several parts of the city," local resident Khaluddin told Reuters news agency.

Taliban spokesman Zabihullah Mujahi said the militants have captured large pockets of the city’s outskirts three times over the past two years.   The latest offensive came amid growing anticipation that American and Taliban negotiators in the Qatari capital Doha were close to reaching an agreement.