Sudan's president, Omar al-Bashir, says his country could go to war over oil with the breakaway state of South Sudan.

President Bashir said on national television Friday that war with its southern neighbor is possible, as he reacted to recent comments from South Sudanese President Salva Kiir.

President Kiir said his country has had no choice but to halt oil production to stop Khartoum from “stealing” oil. He said the issue will not be resolved until the two sides reach a permanent and comprehensive peace agreement.

South Sudan is landlocked, and the pipelines to the Red Sea and other destinations from there run northward through Sudan. Khartoum has sized some of the oil passing through its territory, calling it a compensation for unpaid transit fees. President Kiir says the fee surpasses international norms and his fledgling country cannot afford it.

The two leaders discussed the issue on the sidelines of the recently-concluded African Union summit in Ethiopia, but failed to reach an agreement. The next round of north-south talks is scheduled for next week.

South Sudan seceded from Sudan last July, taking with it most of the region's oil fields.

But the two sides have a host of unresolved issues that include an oil-rich region and border demarcation.

Southern Sudan fought a 21-year civil war with the Khartoum-controlled north, which ended in 2005. People in South Sudan voted overwhelmingly to split from the north in a January 2011 referendum.