S Sudan withdraws from oil area

South Sudan said on Friday it would withdraw its troops from the disputed Heglig oil region more than a week after seizing it from Sudan, pulling the countries back from the brink of war.

Sudan quickly declared victory, saying its armed forces had “liberated” the area as thousands of people poured onto the streets of Khartoum cheering and dancing.

South Sudan’s seizure of the territory had raised the prospect of two sovereign African states waging war against each other openly for the first time since Ethiopia fought newly-independent Eritrea in 1998-2000.

Tensions have been rising since South Sudan split away from Sudan as an independent country in July, under the terms of a 2005 settlement, taking with it most of the country’s known oil reserves.

The countries are still at loggerheads over position of their shared border and other disputes between them have already halted nearly all the oil production that underpins both economies.

South Sudan’s President Salva Kiir ordered the withdrawal of his troops within three days, the country’s information minister told reporters.