Territorial tensions in the South China Sea could explode into "full-scale conflicts" unless quarrelling neighbours abide by international law, a Vietnamese diplomat warned on Friday.

Dang Dinh Quy, president of the state-run Diplomatic Academy of Vietnam, told a Hanoi conference on maritime disputes that the significance of the sea to regional peace was becoming increasingly evident.

"The South China Sea is still rife with smoldering tensions that threaten to escalate into full-scale conflicts if the parties concerned do not exercise self-restraint and respect for the basic principles of international law," he warned.

The forum comes at a time of heightened anxiety over a web of competing claims between Beijing and several regional neighbours, including Vietnam, that centre on strategic island chains in the oil-rich waters.

Quy said an outbreak of hostilities was a risk "if the international community fails to respond to crisis situations" appropriately, but added that the area was still "basically peaceful".

Beijing says it has sovereignty over essentially all of the South China Sea, a key global trading route. Its claim to the Spratly archipelago competes with those of Vietnam, the Philippines, Taiwan, Brunei and Malaysia.

China and Vietnam also have a long-standing dispute over the Paracel island group.

The Philippines and Vietnam have complained of increasing harassment of their fisherman by Chinese vessels in the region.

Last month China and Vietnam pledged to settle their disputes through "friendly consultations", according to the official Xinhua news agency.

Vietnam also backed a proposal from Manila for a peace zone in the disputed area in October.

Philippine President Benigno Aquino has been trying to encourage Southeast Asian neighbours to form a united front to counter China's sovereignty claims.