China urged peace and stability on Thursday after Tehran threatened to punish proposed Western sanctions by choking off oil flows through the Strait of Hormuz, but declined to make any other comment about the crisis.

"China hopes that peace and stability can be maintained in the strait," ministry spokesman Hong Lei told a briefing in answer to a question about escalating tensions that have pushed up oil prices.

China has driven global oil demand growth for a decade and has increasingly relied on shipments from the Middle East, where Iran and rival Saudi Arabia compete for the market. China bought 547,000 barrels per day of crude from Iran through to October this year, up from 426,000 barrels per day for all of 2010.

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