The Chinese and U.S. navies are set to hold high-level talks over tensions in the South China Sea after a U.S. warship challenged Beijing's territorial assertiveness in the disputed waterway this week.<br />The U.S. chief of naval operations and his Chinese counterpart will hold an hour long video teleconference Thursday, days after Beijing was angered by a U.S. warship's patrol within a 12-mile limit around a man-made Chinese island in the South China Sea, a U.S. official said.<br />The patrol was the most significant U.S. challenge yet to territorial limits China claims around its artificial islands in one of the world's busiest sea lanes.<br />"Neither the U.S. nor China desires a military conflict, but the key problem is that the core interests of both sides collide in the South China Sea," said Ni Lexiong, a naval expert at the Shanghai University of Political Science and Law.<br />"It's hard to see either side backing down."