* U.S. draft warns Juba, Khartoum of possible sanctions
* Diplomats want U.N. vote on draft resolution this week (Adds vote expected Wednesday, details)
By Louis Charbonneau
UNITED NATIONS, May 1 (Reuters) - China and Russia are resisting a Western push for the U.N. Security Council to threaten Sudan and South Sudan with sanctions if the two countries fail to comply with demands to halt their escalating conflict, U.N. envoys said on Tuesday.
The U.N. negotiations on Sudan and South Sudan, former civil war foes that split when the south seceded last year, follow weeks of border fighting that have raised fears Khartoum and Juba could launch an all-out war, after failing to resolve a string of disputes over oil revenues and border demarcation.
Delegates from the five permanent members of the Security Council and temporary member South Africa met on Monday for several hours at the U.S. mission in New York to try to reach an agreement on amending a U.S.-drafted resolution on the two Sudans, Western envoys told Reuters on condition of anonymity.
The United States circulated to the 15-nation council on Monday a revised draft resolution that threatens both Sudan and South Sudan with "additional measures" under Article 41 of the U.N. charter, which allows the council to impose economic and diplomatic sanctions on countries that ignore its decisions.
"The draft will probably change before it goes to a vote," a diplomat told Reuters. "China doesn't want any mention of Article 41."
Diplomats said the council was planning to put the draft resolution to a vote on Wednesday, though it was likely to undergo further changes before then. They said the United States and European council members did not want to remove the reference to Article 41 but would be open to a compromise.
"In the end there will be some kind of settlement on the issue," a Western diplomat said.
Beijing, which has close trade relations with both Khartoum and Juba, has traditionally acted as Sudan's protector on the council and for years has shielded it from U.S. and European calls for sanctions due to its handling of conflicts in its western Darfur region and elsewhere in the country.
RUSSIA BACKS CHINA
Russia is supporting China's push to water down the resolution and also dislikes the idea of mentioning Article 41 in the resolution, council diplomats said. Article 41 does not authorize military intervention.
The African Union's Peace and Security Council last week urged both sides to cease hostilities and withdraw troops from disputed areas, and warned it would issue its own binding rulings if they failed to strike deals on a string of disputes within three months.
It also asked the U.N. Security Council to pass a legally binding resolution to demand that Khartoum and Juba comply with the AU declaration.
It will be "much more difficult for the Chinese and Russians to say no to something requested by the African Union," a diplomat said.
Under the latest U.S. draft, as with two previous versions, the council would have to pass a new resolution to impose sanctions on either Khartoum or Juba for not ending hostilities.
Such sanctions typically include an arms embargo, asset freezes and travel bans.
The United States made an attempt to soften the language in the latest draft. The first version, obtained by Reuters, warned Khartoum and Juba of "its determination, in the event that one or both of the parties have not complied, to take appropriate additional measures under Article 41 of the (U.N.) Charter."
The latest version, also obtained by Reuters, softens it by speaking of the council's "intention" to take steps under Article 41 in the event of non-compliance.
China and Russia are traditionally reluctant to impose sanctions on any nation, calling them counterproductive. (Editing by Paul Simao and Jackie Frank)
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