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Kenya PM: Sudan conflict threatens world oil prices

May 21, 2012 -- Updated 0902 GMT (1702 HKT)
A Sudanese soldier stands atop a destroyed tank for Sudan People's Liberation Army of South Sudan in Heglig on April 23, 2012.
A Sudanese soldier stands atop a destroyed tank for Sudan People's Liberation Army of South Sudan in Heglig on April 23, 2012.
  • Kenyan PM has warned the crisis between S.Sudan and Sudan can affect oil prices
  • "The international community cannot sit by and just watch this happening," said Raila Odinga
  • He called African Union to send more troops to resolve the border dispute

(CNN) -- The spiraling conflict between Sudan and South Sudan poses a threat to world oil prices, the prime minister of neighboring Kenya has warned.

Speaking to CNN's Jim Clancy, Raila Odinga called on the international community to take a more active role in resolving the crisis that brought the two countries close to war in April.

"Certainly, if this continues it is definitely going to affect the oil prices and therefore the international community cannot sit by and just watch this happening," said Odinga. "But apart from affecting the oil prices, many people are going to die," he added.

Odinga called on the African Union (AU) to increase its presence in the hotly contested border between the two countries.

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"AU need to send more troops to the border between the North and the South, and while they are there insist that the demarcation be done using independent forces so that the issue of border dispute is resolved once and for all," said Odinga.

"If AU does not have the capacity to do so, then the U.N. should complement AU forces."

Read more: Oil discovered in Kenya

Odinga's call comes as AU mediator and former South African president Thabo Mbeki arrived in the Sudanese capital city of Khartoum Thursday in a bid to convince the two parties to resume negotiations.

South Sudan split from Sudan last year as part of a 2005 peace deal that ended decades of war in Africa's largest nation.

The war left two million people dead and ended with the peace agreement that included an independence referendum for the South.

Significant issues between the countries remain unresolved, however, including status of their citizens, division of national debt, disputed border areas and sharing of oil wealth.

Simmering tensions peaked last month when South Sudan seized the oil-producing region of Heglig from its northern neighbor. Oil fuels the economies of both nations and Heglig oil facilities account for about half of Sudan's production of 115,000 barrels a day.

South Sudanese forces withdrew days later after Sudan lodged protests with the United Nations and African Union, but South Sudan said it continued to come under aerial and ground attack.

Odinga said neighboring Kenya wants the matter "to be dealt with as quickly as possible so the humanitarian crisis is avoided."

He added: "The previous conflict in the Sudan had a very devastating effect on Kenya because we hosted the majority of the Sudanese refugees in Kenya. As we are talking right now there is already an influx of new refugees coming from South Sudan as a result of this conflict, so there is a big fear in Kenya that we may again end up having to host so many refugees as a result of this conflict."

Opinion: Can Kenya avoid Africa's resource curse?

In late March, Kenya announced that it had finally struck oil after decades of exploration. British-based Tullow Oil said it established more than 20 meters (65 feet) of net oil pay, which refers to the depth of the oil reservoir.

But Odinga said that the experience from other African countries has shown that oil can either be "a blessing or a curse." On a cautious note, Odinga stressed that Kenya should not neglect other sectors of the economy in favor of oil.

"One-commodity economy is dangerous in my view because it is not sustainable and therefore in Kenya we must avoid the pitfalls that have been fallen in the other countries on the continent by managing this oil properly," said Odinga.

Victoria Eastwood and Teo Kermeliotis contributed to this report.

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