U.S. struggles to head off wider Sudan conflict
* U.S. sees 'very serious crisis,' threat of war
* Despite backing, US leverage with S.Sudan appears limited
* Pushing for broader talks as immediate crisis mounts
By Andrew Quinn
WASHINGTON, April 19 (Reuters) - The United States is working to push Sudan and South Sudan back from the brink of war as the two sides ratchet up hostilities that threaten to upend the U.S.-backed peace deal that led to South Sudan's independence last year.
The Obama administration's special envoy for Sudan, Princeton Lyman, said on Thursday the situation was a "very serious crisis" that threatened wider conflict between the two foes, which fought a brutal civil war for decades before finally signing a 2005 peace agreement.
But analysts said Washington, which worked hard to ensure that South Sudan seceded peacefully last year under the terms of the 2005 pact, found itself with very limited leverage.
"This is a level of hostility we haven't seen for years," said Jonathan Temin, director of the Sudan program at the U.S. Institute of Peace, a government-funded Washington think tank. "For the U.S., good options are limited right now."
Lyman, speaking by telephone from Khartoum during a trip which also took him to the South's capital, Juba, said the Obama administration was working to nudge both sides back into discussions of their basic security concerns while attempting to cool down the heated rhetoric.
"It's not going to be easy. Emotions are running very, very high," Lyman said. "It is important that we get the parties and our international colleagues together around this fundamental question of security."
Sudan's president, Omar Hassan al-Bashir, vowed on Thursday to teach South Sudan "a final lesson by force" after it occupied a disputed oil field.
The South says the Heglig field, which accounts for about half of the North's remaining oil production, is in its territory. But Khartoum called the seizure an assault on its sovereignty. U.N. Secretary-General Ban Ki-moon on Thursday called the takeover "a clearly illegal act.".
The standoff over Heglig follows months of disputes over the position of the border, how much the landlocked South should pay to transport its oil through Sudan, and the division of national debt, among other issues.
South Sudan in January shut down its oil production of 350,000 barrels per day in protest after Khartoum began taking some of its oil, exacerbating economic crises that have hobbled both countries. Khartoum says it took the oil as compensation for the use of its transportation facilities.
Lyman said he urged South Sudan to pull out of Heglig, and believed the South Sudanese leaders were caught by surprise by the strong international condemnation of the move.
Lyman said the United States, together with the African Union and the Arab League, would push for dialogue on three central security points: the establishment of a 20-km (12-mile) demilitarized border zone, the end of support for proxy fighters and a halt to rebel fighting in Sudan's Southern Kordofan and Blue Nile states.
"That pulls together three critical security issues, which are really what's underneath these series of clashes that's been going on since last June," Lyman said.
The United States also hopes that China - a major economic partner for both of the poor African neighbors - would bring its influence to bear when South Sudan's president, Salva Kiir, visits Beijing next week, Lyman said.
It remained unclear whether anyone in Khartoum or Juba was ready to listen.
While Washington's ties to Khartoum have long been strained, it has also made surprisingly little headway with Juba despite the U.S. role as a major aid provider and guarantor of the 2005 peace deal.
"They really need to be laying down the law to the government in Juba now," said Richard Downie, deputy director of the Africa program at the Center for Strategic and International Studies.
"The U.S. has to be pulling out all the stops and get the South to withdraw from Heglig," Downie said. "Right now we're beyond a worse-case scenario. You've got a war combined with an economic crisis combined with an oil shutdown, which is about as bad as you can get."
The U.N. Security Council has discussed the possibility of imposing sanctions on both Sudan and South Sudan if the fighting does not stop - a potentially disastrous prospect for countries already on the verge of economic meltdown.
"Just the fact that people are mentioning (sanctions) I hope sends the signal to both parties: this is very serious business, it effects international peace and security and the parties must work with all of us to get it under control," Lyman said. (Editing by Peter Cooney)
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