Sudanese insurgents in the country's main oil-producing state South Kordofan battled government forces in a volatile border region for a second day Wednesday, a rebel spokesman said.

Sudan's military denied the assertion, however, saying the region was quiet after the army repulsed a rebel attack on Tuesday.

Four months since the new country of South Sudan gained independence from Sudan, fighting in areas near the border has complicated talks over unresolved issues such as how to manage the formerly integrated oil industry.

The two countries have accused one another of backing rebel groups near the border. Analysts say clashes threaten to drag the old civil war foes into a proxy conflict.

South Kordofan is north of the new border and remains part of Sudan, but is home to rebels that sided with the south during the civil war that ended with the peace agreement that led to independence for South Sudan this year.

Qamar Dalman, a spokesman for the rebel Sudan People's Liberation Army-North (SPLA-N) in South Kordofan, said insurgents were continuing to advance on the town of Taludi on Wednesday.

There is heavy fighting around Taludi between SPLA forces and the Sudanese army. The SPLA army is very close to the city. The Sudanese army is bombing from military planes, he said by telephone.

Al-Sawarmi Khalid, Sudan's army spokesman, dismissed the claim. There is not any fighting or clashes today around Taludi. Everything is quiet, he said.

Both sides claimed to have killed hundreds of their opponents during a rebel assault on Taludi Tuesday. The accounts could not be verified independently.

The United Nations said Wednesday more than 18,000 civilians have fled since the outbreak of fighting in South Kordofan to Unity state across the border in South Sudan.

Humanitarian partners are concerned that the number of people arriving to Unity might double before the end of the year if fighting continues in Southern Kordofan, the U.N. Office for the Coordination of Humanitarian Affairs said in a report.

Unity, the main oil-producing state in South Sudan, has itself been hit by fighting between the new country's government's troops and rebels.

North of the border, conflict has torn South Kordofan and Blue Nile, states where tens of thousands of fighters sided with the south during the decades-long civil war that killed some 2 million people.

Rebels in those states say they have been politically and economically marginalised by Sudan's government. Khartoum accuses the insurgents of trying to spread chaos and says it will not tolerate armed militias on its side of the border.

South Sudan seceded after voting for independence in a January referendum promised in a 2005 peace deal that ended one of Africa's longest and deadliest civil wars.

(Reporting by Khalid Abdelaziz; Additional reporting by Ulf Laessing; Writing by Alexander Dziadosz; Editing by Peter Graff)