'You should've taken them back': Trump scolds Europe as 'IS families' escape Syria camp

"The US has the worst of the IS prisoners. Turkey and the Kurds must not let them escape. Europe should have taken them back after numerous requests. They should do it now. They will never come to, or be allowed in, the United States!" Trump tweeted.

The remarks came after hundreds of relatives of foreign jihadis escaped from a displacement camp in northern Syria, Kurdish authorities said on Sunday, as the number of people fleeing a Turkish assault soared to 130,000.

Kurdish authorities and foreign powers have warned repeatedly that the hostilities could undermine the fight against the Islamic State group (IS) and allow jihadis to break-out of captivity.

The Kurdish administration in northern Syria said that a Turkish bombardment near a camp for the displaced led to nearly 800 relatives of IS members fleeing.

Aid groups have warned of another humanitarian disaster in Syria's eight-year-old war if the offensive is not halted.

The UN humanitarian agency OCHA said the exodus sparked by the fighting had grown to 130,000 people and it was preparing for that figure to more than triple.

"We have moved into a planning scenario where up to 400,000 people could be displaced within and across the affected areas," spokesman Jens Laerke told AFP. 

Some 12,000 IS fighters - Syrians, Iraqis as well as foreigners from 54 countries - are detained in Kurdish prisons. 

Displacement camps meanwhile host some 12,000 foreigners - 8,000 children and 4,000 women.

"The brutal military assault led by Turkey and its mercenaries is now taking place near a camp in Ain Issa, where there are thousands (of people) from families of IS," a Kurdish administration statement said.

"Some were able to escape after bombardments that targeted" the camp.

It said the Ain Issa camp was "now without guards" and 785 relatives of IS jihadists had fled.

Fighting has engulfed the area since Wednesday when Ankara launched a long-threatened offensive against the Kurdish-led Syrian Democratic Forces (SDF), who it considers "terrorists" linked to Kurdish insurgents inside Turkey. 

The SDF, a coalition of Kurdish and Arab fighters, was the main partner on the ground in the US-led campaign against IS.

Trump has been accused of abandoning a loyal ally in the fight against IS after ordering American troops to pull back from the border.

The Pentagon said on Sunday President Donald Trump had ordered the withdrawal of up to 1,000 troops from northern Syria - almost the entire ground force in war-torn country.

Trump tweeted on Sunday that it was "very smart not to be involved in the intense fighting along the Turkish Border, for a change".

"The Kurds and Turkey have been fighting for many years... Others may want to come in and fight for one side or the other. Let them! We are monitoring the situation closely. Endless Wars!" he said.

US troops near the northern border came under artillery fire from Turkish positions on Friday, the Pentagon said, warning that the US was prepared to meet aggression with "immediate defensive action."

The US military confirmed an explosion within a few hundred metres of its post near the town of Kobani, in an area "known by the Turks to have US forces present".

Treasury Secretary Steven Mnuchin announced Friday that Trump had authorised - but not yet activated - new sanctions to dissuade Turkey from further offensive military action.

"We can shut down all US dollar transactions with the entire government of Turkey," Mnuchin told ABC on Sunday.

"It's something we may do. There's full authority and something at a moment's notice the president can tell me to do."

However, Erdogan hit back at the threats saying sanctions and arms embargoes by Western powers would not stop Turkey's military offensive against Kurdish militants in Syria.

"After we launched our operation, we have faced threats like economic sanctions and embargoes on weapons sales. Those who think they can make Turkey turn back with these threats are gravely mistaken," Erdogan said in a televised speech.

The comments came after France and Germany said on Saturday that they were suspending arms exports to Turkey over its offensive in Syria against the Kurdish People's Protection Units (YPG).

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