President Barack Obama has acknowledged that U.S. intelligence underestimated the rise of Islamic State fighters in Iraq and Syria, where the head of an al Qaeda branch warned militants will attack the West in retaliation for U.S.-led air strikes.

Turkish tanks took up positions on the Syrian frontier, opposite a besieged border town where Islamic State shelling intesified and stray fire hit Turkish soil.

U.S.-led air strikes overnight hit a natural gas plant controlled by Islamic State fighters in eastern Syria, a monitoring body reported, part of an apparent campaign to disrupt one of the fighters' main sources of income.

The monitoring group, the Syrian Observatory for Human Rights, said planes also struck a grain silo in northern Syria killing civilians. This could not be immediately confirmed.

U.S.-led strikes have so far failed to halt an advance by fighters in northern Syria on Kobani, a Kurdish town on the border with Turkey where the past week's battle caused the fastest refugee flight of Syria's three-year civil war.

At least 15 Turkish tanks were positioned at the frontier, some with guns pointed towards Syrian territory. More tanks and armoured vehicles moved towards the border after shells landed in Turkey on Sunday and Monday.

The United States has been bombing Islamic State and other groups in Syria for a week with the help of Arab allies, and hitting targets in neighbouring Iraq since last month. European countries have joined the campaign in Iraq but not in Syria.

Islamic State, a Sunni militant group which broke off from al Qaeda, alarmed the West and the Middle East by sweeping through northern Iraq in June, slaughtering prisoners and ordering Shi'ites and non-Muslims to convert or die.

It is battling Shi'ite backed governments in both Iraq and Syria, as well as other Sunni groups in Syria and Kurdish groups in both countries, part of complex multi-sided civil wars in which nearly every country in the Middle East has a stake.

The head of Syria's al Qaeda branch, the Nusra Front, a Sunni militant group which is a rival of Islamic State and has also been targeted by U.S. strikes, said Islamists would carry out attacks on the West in retaliation for the campaign.

"Muslims will not watch while their sons are bombed. Your leaders will not be the only ones who would pay the price of the war. You will pay the heaviest price," Abu Mohamad al-Golani said in an audio message posted on pro-Nusra forums.

He also said his followers should not take advantage of the U.S. strikes to hit out at Islamic State. The U.S. strikes have created pressure on Nusra to reconcile with Islamic State, a move that would unite Syria's most powerful Sunni Islamist forces and widen territory under their control.

Obama has worked since August to build an international coalition to combat the fighters, describing them last week in an address to the United Nations as a "network of death".

His acknowledgment in an interview broadcast on Sunday that U.S. intelligence had underestimated Islamic State offered an explanation for why Washington appeared to have been taken by surprise when the fighters surged through northern Iraq in June.

The militants had gone underground when U.S. forces quashed al Qaeda in Iraq with the aid of local tribes during the U.S. war there which ended in 2011, Obama told CBS's "60 Minutes".

"But over the past couple of years, during the chaos of the Syrian civil war, where essentially you have huge swathes of the country that are completely ungoverned, they were able to reconstitute themselves and take advantage of that chaos."

Some of the U.S. president's opponents at home have seized on a remark he made in January using a sports metaphor to dismiss Sunni militants in Iraq and Syria. He compared them to a low-level school basketball team posing as professionals.

"If a JV (junior varsity) team puts on Lakers uniforms, that doesn't make them Kobe Bryant," Obama told the New Yorker magazine in January.

BATTLE ON BORDER

Islamic State's advance has not been halted in Syria, where it is fighting Kurdish forces near the border city of Kobani, where 140,000 refugees fled a week ago.

Gunfire rang out from across the border and a plume of smoke rose over Kobani as periodic shelling by Islamic State fighters took place. Kurds watching the fighting from the Turkish side of the border said the Syrian Kurdish group, the YPG, was putting up a strong defence.

"Many Islamic State fighters have been killed. They're not taking the bodies with them," said Ayhan, a Turkish Kurd who had spoken by phone with one of his friends fighting with the YPG. He said Kurdish forces had picked up eight Islamic State bodies.

At Mursitpinar, the nearby border crossing, scores of young men were returning to Syria saying they would join the fight. More refugees were fleeing in the opposite direction.

"Because of the bombs, everyone is running away. We heard people have been killed," said Xelil, a 39-year-old engineer who fled Kobani on Monday. "The YPG have got small weapons but Islamic State has big guns and tanks."

A local official inside Kobani said Islamic State continued to besiege the town from the east, west and south and that the militants were 10 km from the outskirts.

"From the morning there have been bomb shellings into Kobani and ... maybe about 20 rockets," Idris Nassan, deputy foreign minister in a local Kurdish administration said by phone. He said the rockets had killed at least three people in the town.

Turkey has not permitted its own Kurds to cross to join the battle: "If they've got Syrian identity or passports, they can go. But only Syrians, not Turks," said one Turkish official at the border where security has been tightened.

A NATO member with the most powerful army in the area, Turkey has so far kept out of the U.S.-led coalition, angering many of its own Kurds who say the policy has abandoned their cousins in Syria to the wrath of Islamic State fighters.

OBAMA STILL SEEKS DOWNFALL OF ASSAD

The U.S.-led coalition includes Sunni Arab states who oppose Syria's Assad, but does not include Assad or his main ally Iran, even though Islamic State's sway in Syria grew from the revolt against Assad's government.

Obama, who nearly ordered air strikes against Assad's government a year ago only to cancel them at the last minute, said he recognised the apparent contradiction in opposing Assad while bombing his enemies. He still wants Assad to leave power, but considers Islamic State the more urgent threat.

"For Syria to remain unified, it is not possible that Assad presides over that entire process," he said in his interview.

"On the other hand, in terms of immediate threats to the United States, ISIL, Khorasan group, those folks could kill Americans," he said, using an acronym for Islamic State and the name of a separate cell of al Qaeda figures targeted last week.

Saudi Arabia, the regional Sunni power which has joined the U.S.-led strikes, blamed other countries for supporting Islamic State, although it did not name them. Riyadh has in the past criticised Qatar for supporting Islamist movements.

Islamic State was formed not in a "haphazard fashion but under the auspices of states and organisations with all their capabilities and bad intentions," Saudi Interior Minister Prince Mohammed bin Nayef said. "We will firmly face this organisation and others."

The Syrian Observatory, which monitors the conflict with a network of sources on the ground, said U.S.-led strikes had hit a Conoco gas plant controlled by Islamic State outside Deir al-Zor city in eastern Syria, wounding several fighters.

The plant feeds a power station in Homs that provides several provinces with electricity and powers oilfield generators, the Observatory said.

The observatory also said warplanes had hit mills and grain storage areas in the northern Syrian town of Manbij, killing civilian workers. It was not immediately possible to verify the information and there was no immediate comment from Washington.

U.S.-led warplanes also hit areas of Hasaka city in Syria's north east and the outskirts of Raqqa city in the north, which is Islamic State's stronghold. Syria's state news agency also said U.S.-led forces had carried out strikes in Raqqa province.

Some of Assad's opponents worry that the U.S.-led bombing will help the Syrian leader stay in power by hurting his most powerful Sunni foes. Syria's military has intensified its own bombing campaign in the country's west, even as Washington has struck in the east. Overnight, Damascus carried out air raids in Aleppo province and in Hama, the Observatory said.