"Certain nations kind of take advantage or do things that are short of conflict," Neller said at a panel discussion Monday at the Navy League's Sea-Air-Space exposition. "They are very subtle and very calculated, but they don't support the stability of the region."
Neller said the U.S. would continue to support international law while trying to build trust with the nations in the Asia-Pacific region; China claims nearly the entire South China Sea, with increasing worries they are militarizing the islands to back up those claims.
"We are a nation of laws, we go out and do what we do to support international law," Neller continued. "What we cannot do is stop talking, even if we disagree. There may be actors who would potentially do some things that we don't agree with and we need to maintain communication with them. And tell them that their actions are potentially disruptive to the stability of the world."
"In the near term, we have to be able to meet our treaty obligations and exercise our sovereign rights under international law to transit the seas. And we'll see where that takes us. Hopefully that creates stability and not instability."
The comments are part of a transoceanic blame-game between Washington and Beijing over who is at fault for the rising tensions. In March, China's foreign minister told Xinhua News Agency that the U.S. operations in the South China Sea were destabilizing the region.
"I want to remind some people that the freedom of navigation doesn't give them a license to do whatever they want," Wang Yi said. "If someone wants to muddy the waters in the South China Sea and to destabilize Asia, China would not agree to it, and I think the overwhelming majority of countries in the region would not allow that to happen."
The island-building project has ratcheted up tensions in the region and prompted the Philippines to lodge a formal complaint wih the U.N.'s permanent court of arbitration to challenge China's actions.
"Although these artificial islands do not provide China with any additional territorial or maritime rights within the South China Sea, China will be able to use them as persistent civil-military bases to enhance its long-term presence in the South China Sea significantly," the report reads.
"China demonstrated a willingness to tolerate higher levels of tension in the pursuit of its interests, especially in pursuit of its territorial claims in the East and South China Sea; however, China still seeks to avoid direct and explicit conflict with the United States," the report said.
"China's leaders understand that instability or conflict would jeopardize the peaceful external environment that has enabled China's economic development, which is central to the perpetuation of the [Chinese communist party's] domestic legitimacy. In the near-term, China is using coercive tactics short of armed conflict, such as the use of law enforcement vessels to enforce maritime claims, to advance their interests in ways that are calculated to fall below the threshold of provoking conflict."
The Coast Guard's top officer, Adm. Paul Zukunft, said the ruling on the Philippines' claim could serve as a "triggering mechanism" for a further tensions in the South China Sea.
"There will be a few triggering mechanisms over the coming year and one of them will be the rendering of the U.N. tribunal ... at a point when our relationship with the Philippines is growing ever closer," Zukunft said.
"What we will see is people turning to the United States because of our record of abiding by rules of behavior, providing that model for maritime governance at sea so that all may prosper."
David B. Larter was the naval warfare reporter for Defense News. Before that, he reported for Navy Times.