At least 20 people have been killed and 40 wounded by an attack by terrorist group al-Shabab on a popular hotel in the Somali capital, as terrorists stormed the hotel, engaging in an hours-long exchange of fire with the security forces, an official said Saturday.

Gunmen from the Al-Qaida-linked al-Shabab stormed the Hayat Hotel in Mogadishu on Friday evening in a hail of gunfire and bomb blasts, trapping scores of people.

Sporadic gunfire and loud explosions could still be heard early Saturday.

It is the biggest attack in Mogadishu since Somalia's new President Hassan Sheikh Mohamud was elected in May after many months of political instability.

"The security forces continued to neutralize terrorists who have been cordoned inside a room in the hotel building. Most of the people were rescued but at least eight civilians were confirmed dead so far," security commander Mohamed Abdikadir told Agence France-Presse (AFP).

"The security forces rescued dozens of civilians including children who were trapped in the building."

Al-Shabab, which has been waging a deadly insurgency against Somalia's central government for about 15 years, claimed responsibility for the attack and said it was still in control of the hotel Saturday.

Dozens of people have been gathering outside the four-story hotel to discover the fate of loved ones.

"We have been looking for a relative of mine who was trapped inside the hotel, she was confirmed dead together with six other people, two of them I know," said one anxious witness Muudey Ali.

There has been no official comment from the government about the attack.

Witnesses reported at least two large explosions as the gunmen stormed the hotel, a popular spot frequented by government officials and ordinary Somalis in a bustling area on the airport road.

Police spokesperson Abdifatah Adan Hassan had told reporters late Friday that the initial blast was caused by a suicide bomber who forced his way into the hotel with several other gunmen.

Witnesses said a second blast occurred just a few minutes later, inflicting casualties on rescuers and members of the security forces and civilians who rushed to the scene after the first explosion.

The militants claimed responsibility in a brief statement on a pro-Shabab website, saying its fighters were carrying out "random shooting" inside the hotel.

Al-Shabab spokesperson Abdiaziz Abu-Musab told the group's Andalus radio on Saturday that its forces were still in control of the building and that they had "inflicted heavy casualties."

Earlier this week, the United States announced that its forces had killed 13 al-Shabab terrorists in an airstrike in the central-southern part of the country as the militants were attacking Somali forces.

The U.S. has carried out several air raids on the militants in recent weeks.

In May, President Joe Biden ordered the re-establishment of a U.S. troop presence in Somalia to help local authorities combat Al-Shabab, reversing a decision by his predecessor Donald Trump to withdraw most U.S. forces.

In recent weeks, Al-Shabab fighters have also launched attacks on the Somalia-Ethiopia border, raising concerns about a possible new strategy by the extremists.

Somalia's new President Mohamud said last month that ending Al-Shabab's insurgency required more than a military approach, but that his government would negotiate with the group only when the time was right.

Al-Shabab was driven out of the capital in 2011 by an African Union force, but the group still controls swathes of countryside.

It continues to launch deadly strikes on political, civilian and military targets, with popular hotels and restaurants frequently hit.

Earlier this month, new Prime Minister Hamza Abdi Barre announced the appointment of the group's former deputy leader and spokesperson, Muktar Robow, as religion minister.

Robow, 53, publicly defected from Al-Shabab in August 2017, with the U.S. government at one point offering a $5 million bounty for his capture.

The Horn of Africa nation has been mired in chaos since the fall of the military regime of President Siad Barre in 1991.

His ouster was followed by a civil war and the ascendancy of Al-Shabab.

The deadliest attack in Somalia occurred in October 2017 when a truck packed with explosives blew up in a bustling commercial district of Mogadishu, killing 512 people.

As well as the grinding insurgency, Somalia is also in the grip of a devastating drought that has driven one million people from their homes and left the country in the shadow of famine, according to the United Nations.