RIYADH, Saudi Arabia — An al-Qaida cell beheaded American engineer Paul M. Johnson Jr., and in a swift retaliation Saudi security forces tracked down and killed the area leader of the terrorist group in a shoot-out Friday.

Johnson, who was kidnapped last weekend, was the latest victim of an escalating campaign of violence against Westerners that aims to drive foreign workers from the kingdom and undermine the ruling royal family, hated by al-Qaida.

The death hours later of Abdulaziz al-Moqrin, the reputed leader of al-Qaida in the kingdom, was a coup for the Saudi government, which has been under intense pressure to halt a wave of attacks against Westerners. In a video posted on the Internet Tuesday, a hooded al-Moqrin held an assault rifle and shouted demands for the release of al-Qaida prisoners as a blindfolded Johnson sat in a chair.

But the Saudi forces were too late to save Johnson, whose severed head was shown on a Web site Friday. The photographs and a statement, in the name of Fallujah Brigade of al-Qaida in the Arabian Peninsula, appeared after Johnson's wife went on Arab television and tearfully pleaded for his release.

"In answer to what we promised . . . to kill the hostage Paul Marshall (Johnson) after the period is over . . . the infidel got his fair treatment," the al-Qaida statement said.

"Let him taste something of what Muslims have long tasted from Apache helicopter fire and missiles," the statement said.

Johnson, 49, worked on Apache attack helicopter systems for Lockheed Martin. His captors had threatened to kill him by Friday if the kingdom did not release its al-Qaida prisoners. The Saudi government rejected the demands.

President Bush said the execution "shows the evil nature of the enemy we face."

"They're trying to get us to retreat from the world," Bush said. "America will not retreat. America will not be intimidated by these kinds of extremist thugs. May God bless Paul Johnson."

After Johnson's death was reported, his family was in seclusion at a town house in Galloway Township, N.J., where they have been holding a vigil.

John Hayes, a childhood friend of Johnson's, was overcome with emotion.

"It's just unbelievable. He didn't deserve that," said Hayes, 50. "This man wasn't even fighting a war over there."

Shortly after discovering Johnson's body, Saudi police swooped down on the al-Malz neighborhood in central Riyadh and exchanged fire with al-Qaida suspects.

Saudi officials in Washington said on condition of anonymity that four militants and five Saudi security officers were killed in the gunbattle, and that fighting was continuing. Two suspects escaped, said one Saudi security official who took part in the raid.

A U.S. official, who spoke on condition of anonymity, confirmed that al-Moqrin, 31, was one of the dead. A Saudi official said forensic tests would be conducted on the body to confirm his identity.

The Saudi-owned Al-Arabiya TV identified two of the dead militants as brothers Faisal Abdulrahman Abdullah Al Dakheel and Bandar Abdulrahman Abdullah Al Dakheel, both on the government's most-wanted list.

Al-Moqrin's fighters are blamed in a string of terror strikes in Saudi Arabia in recent months, among them the May 29 shooting and hostage-taking attack on the oil hub of Khobar that killed 22 people, most of them foreign, and the Nov. 8, 2003 suicide bombing at Riyadh housing compounds that killed 17, most of them non-Saudi Muslims working in the kingdom.

The beheaded body was dressed in a bright orange jumpsuit, similar to one Johnson is seen wearing in earlier videos released by the kidnappers.

"To the Americans and whoever is their ally in the infidel and criminal world and their allies in the war against Islam, this action is punishment to them and a lesson for them to know that whoever steps foot in our country, this decisive action will be his fate," the al-Qaida statement said.

There are 35,000 Americans among the millions of Westerners who work in Saudi Arabia.

Soon after the statement appeared, the Web site was inaccessible, with a message saying it was closed for maintenance.

Johnson is the second American to be kidnapped and beheaded in the Middle East in just over a month.

American businessman Nicholas Berg was beheaded by his captors in Iraq, and his last moments later appeared on a videotape posted on an al-Qaida-linked Web site. His body was found May 12. U.S. officials say al-Qaida-linked Muslim militant Abu Musab al-Zarqawi may have been Berg's killer.

Johnson's beheading is the latest in a new, more dramatic wave of terror attacks for Saudi Arabia: bodies dragged on streets, traffic police blown up in their offices, hotel guests taken hostage and a chef shot outside an ATM machine. The attacks have killed dozens of people, mostly foreigners, over the past two months.

The violence is escalating despite an aggressive campaign by the government to root out terrorism, leaving many wondering whether the attacks are just the beginning or — as the government continues to insist — the last gasps of a desperate group reacting to the pressure of the hunt.

Johnson was seized on June 12, the same day that Islamic militants shot and killed Kenneth Scroggs of Laconia, N.H., in his garage in Riyadh.

Scroggs worked for Advanced Electronics Co., a Saudi firm whose Web site lists Lockheed Martin among its customers. The office number on Johnson's business card was for Advanced Electronics.

The same week as Scroggs' death, militants shot and killed another American, Robert Jacobs, and an Irish citizen in Riyadh.

It appears that Jacobs was also decapitated after being shot to death. Video shows his attackers bent over his body, making a sawing motion near the head, though there was no confirmation.

Earlier, Saudi security forces launched an all-out search, going door-to-door in some Riyadh neighborhoods, and Johnson's Thai wife, Thanom, made an appearance on Al-Arabiya.

"When I see his picture in TV, I fall down," Thanom said, fighting back tears. "When I hear the name Paul Johnson, I cry a lot."

But residents of three Islamic fundamentalist districts in Riyadh, interviewed before news broke of Johnson's killing, suggested that the kidnappers enjoyed popular support, partly because of U.S. policy in Iraq and its perceived backing for Israel.

"How can we inform on our brothers when we see all these pictures coming from Abu Ghraib and Rafah," Muklas Nawaf told The Associated Press as he ate meat grilled on a spit at a restaurant called Jihad, or holy war in Arabic.

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He was referring to the pictures of Iraqis abused by U.S. soldiers at the Abu Ghraib prison in Baghdad and Israeli military incursions and killings in the Gaza refugee camp of Rafah.

"This is not a little skirmish. It is a war," Nawaf said.

A man who was shopping with his family in Sweidi, an Islamic fundamentalist district of the capital, agreed.

"These (kidnappers) are holy warriors, heroes, who never waver, even if they will fail," Mizahen al-Etbi told the AP. "All Saudis hate Americans, not only these heroes."

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