* Turkey, Iran divided over Syria
* Turkey reliant on Iranian oil and gas
ISTANBUL, Dec 16 (Reuters) - Iran's president has cancelled
a trip to Turkey a day after his military chief warned the
deployment of NATO missiles along its border with Syria could
lead to a "world war", Turkey's state-run Anatolian news agency
said on Sunday.
President Mahmoud Ahmadinejad had been invited by Turkish
Prime Minister Tayyip Erdogan to the central city of Konya on
Monday for an annual ceremony marking the death of Rumi, the
13th century Sufi mystic.
The two leaders had been expected to discuss issues
including the conflict in Syria as well as the impact of U.S.
sanctions, imposed over Tehran's disputed nuclear programme, on
Turkey's imports of oil and gas from Iran.
Anatolian quoted diplomatic sources as saying Ahmadinejad
had cancelled his trip because of a conflict in his schedule.
Tensions between Turkey and Iran have risen over Syria.
Iran has been a staunch ally of Syrian President Bashar
al-Assad throughout the 21-month uprising against his rule,
while Turkey has been one of his fiercest critics and has
supported the opposition and given refuge to military defectors.
Iranian armed forces chief General Hassan Firouzabadi said
on Saturday that the planned deployment of NATO Patriot missiles
along Turkey's border with Syria could lead to a "world war"
that would threaten Europe as well.
Turkey asked NATO for the Patriot system, designed to
intercept aircraft or missiles, in November to help bolster its
border security after repeated episodes of gunfire and shells
from Syria spilling into Turkish territory.
Despite the tensions, Turkey, which is heavily dependent on
imported energy, relies on oil and gas imports from Iran and
trade has continued largely unhindered.
Turkey has won waivers from U.S. sanctions by trimming its
Iranian oil purchases while Tehran, frozen out of the global
banking system, has sharply increased its purchases of gold
bullion from Turkey, raising Washington's concern.
Payments for gas imports to Turkey are made to Iranian state
institutions. U.S. and European banking sanctions ban payments
in dollars or euros so Iran gets paid in Turkish lira. Lira are
of limited value on international markets but ideal for buying
gold in Turkey.
Couriers have been carrying the gold to Dubai and from there
it is shipped to Iran.
In the first ten months of the year, Turkey exported $11.9
billion of gold, of which 60 percent was sold to Iran, 30
percent to the United Arab Emirates and the rest to European
countries including Switzerland, Economy Minister Zafer Caglayan
told a parliamentary budget hearing on Friday.
Turkish officials have repeatedly said there is nothing
illegal about the gold sales, which they say are carried out by
private companies and therefore not subject to sanctions.
"Turkey will continue to export any kind of product on the
basis of legal means, within the framework of international
agreements," Caglayan said.
The U.S. State Department has said it is in talks with
Ankara over its gold exports to Tehran.
(Reporting by Nick Tattersall; Editing by Stephen Powell)