The well-armed British fleet could do severe damage to Argentina's less well-equipped Navy, according to military experts here.
But the one thing the British may be incapable of doing -- unless they are willing to take extremely high losses -- is to recapture Port Stanley, capital of the Falkland Islands.
''There is one thing a lot of people agree on,'' says a diplomat here. ''If it comes to war, there will be no winners. Or, if there is a winner, it will be the Russians.''
This is one reason that diplomats still see a glimmer of hope for a negotiated settlement of the dispute between Argentina and Britain.
There is another reason for a settlement: The economic consequences of war could be catastrophic for both sides.
But Argentine officials apparently are not optimistic about the prospects for a settlement. Speaking on the eve of the expected arrival here on April 15 of US Secretary of State Alexander M. Haig Jr., Argentine Foreign Minister Nicanor Costa Mendez said that negotiations being carried out by the United States to resolve the conflict ''have not registered any progress.''
Some US residents of this country fear, meanwhile, that if negotiations break down and the two sides decide to fight over the Falklands, Argentines will blame the US. Life could then become very difficult for US citizens here, they say.
Argentine newspapers have carried a report from the American television network ABC that says the US is supplying Britain with US intelligence on Argentina, including the movements of its fleet. This report has stirred resentment here against the US.
A front-page headline in the newspaper Chronica put it this way: ''Yankees explain aid to pirates.'' Several newspaper here refer to the British as ''pirates.''
Meanwhile, both sides increased the supplies and war equipment that would be available to them in case of an armed conflict. Argentine journalists returning to Buenos Aires from the Falklands said that C-130 transport planes were taking off and landing continuously on the islands and that Argentine fighter-bombers maintained an umbrella over more than 8,000 troops on the islands.
According to Argentine press reports, two Argentine gunboats are reported to have eluded the British submarine blockade and reached the islands.
Argentina, with an estimated 100 fighter planes ready for combat, holds clear superiority in the air over some 40 British Harrier jets, and this is believed to be more worrisome to the British than any other factor. Even if the British can maintain a naval blockade around the Falklands, they might have great difficulty in breaking the air bridge now linking the Argentine mainland to the islands. Any attempt to disrupt that bridge would bring the British up against Argentina's US-built Skyhawk fighter-bombers, French-built Mirages, and Israeli-built Daggers -- the Israeli version of the Mirage.
Military experts say Britain has the advantage in submarines and in some of its naval armament. Britain has at least two nuclear-powered submarines cruising in the region. These submarines can move at great depth and speed and are known to be much quieter than Argentina's four submarines.
The British Navy contends that these submarines are almost undetectable and that their sophisticated sonar can pinpoint enemy vessels up to 40 miles away. Some of the subs' advantage may be lost in this region, however, because the Argentine continental shelf is rarely deeper than some 600 feet.
If the Argentine Navy had to face the British in a frontal attack, it might be at a great disadvantage. But Argentine naval experts say their fleet would likely disperse.
Given the heavy resistance it is likely to meet on the Falklands, Britain may decide first to try to recapture the South Georgias. These islands are more lightly defended by the Argentines and, at 1,100 miles from the mainland, they would be much more difficult to hold against a British assault.
According to Rear Adm. Jorge Alberto Fraga, professor at the Argentine naval warfare school, a military force attempting to take Port Stanley by ground assault would require ''overwhelming superiority'' in numbers. But the number of Argentine troops now occupying the Falklands appears to be nearly double that of the British Marines and paratroops now aboard the British fleet. The British, Fraga says, would suffer ''enormous losses'' in a ground assault.