Scepter Holdings Inc. (BRZL)

[bayarea]

this could force oil even higher

any form of default could destabilize the global economy and sour already tense relations with big U.S. creditors such as China, government officials and investors warn.

China is the largest foreign creditor to the United States, holding more than $1 trillion in Treasury debt as of March, U.S. data shows, so its concerns carry considerable weight in Washington.

"I really worry about the risks of a U.S. debt default, which I think may lead to a decline in the dollar's value," Li said.