The Obama administration has condemned shooting by Yemeni security forces against anti-government protesters that left at least 12 dead on Monday.
Witnesses say plainclothes police and snipers shot at the demonstrators in Taiz after they surged into a square facing government headquarters. There were numerous casualties.
Foreign media footage showed protesters drenched in blood as makeshift hospitals were set up to treat the wounded.
Witnesses report that dozens of protesters were also wounded during clashes in Hodeida and Beyda.
Unidentified U.S. and Yemeni officials say the U.S. position changed more than a week ago, when the talks began. The State Department spokesman would not confirm the reports.
The Yemeni president has offered to step down but only after new elections are held. His term ends in 2013. He has been in power for 32 years.
A Yemeni official told the Times says the negotiations center on a proposal in which Mr. Saleh would hand over power to a provisional government led by Vice President Abd al-Rab Mansur al-Hadi until new elections are held.
Yemen has seen increasingly bloody protests against the longtime president since late January. Mr. Saleh recently called for an end to the protests and said he is willing to discuss the peaceful transfer of power “according to the constitution.”