BY the middle of August, Arab and Western commentators were generally of the opinion that war in the Gulf was inevitable. Over the past few days, though, the mood has changed a little. The best hope that war might be averted, in the view of Middle East observers, is the decision by the United Nations Secretary General Javier P'erez de Cu'ellar to try to mediate in the crisis. He meets with the Iraqi foreign minister, Tariq Aziz, in the Jordanian capital, Amman, tomorrow. Jordanian officials say they expect him to fly on to Baghdad later in the week for a meeting with President Saddam Hussein.
Mr. P'erez de Cu'ellar is no stranger in Baghdad, having mediated a cease-fire in the Gulf war between Iraq and Iran.
But Western diplomats in the Gulf caution against excessive optimism. ``All the Secretary-General can do,'' one points out, ``is offer his services to Saddam to help him find a way of accepting the various UN Security Council resolutions and of withdrawing from Kuwait without losing face. If Saddam refuses such assistance, the scope for compromise is at best minimal.''
A senior Arab diplomat says the major difficulty faced by would-be mediators is that there are at least three perceptions of how the crisis should be handled.
``Arab mediation efforts led by King Hussein of Jordan are aimed at finding an Arab formula which would ensure the withdrawal of Western forces - to get the whole affair back `into the Arab tent,''' he says. ``In the short term the King is trying to get Arab leaders' help in cooling the crisis, and in keeping the two armies apart while the Arabs concoct a face-saving compromise.''
The problem with this perception is that it overlooks the insistence on the part of many world leaders, especially those in the West, that there can be no compromise over the question of Kuwait's territorial integrity.
The third perception, in the view of the Arab diplomat, is an unstated view in the West that there will never be stability in the Gulf as long as President Saddam Hussein is alive and in power. In other words, an Arab-backed compromise, or even an unconditional Iraqi withdrawal, would still not satisfy Washington, London, and other Western capitals.
``There would still be the fear,'' a Western diplomat in the Gulf concedes, ``that one day Saddam would have another go at grabbing the Saudi oil fields.''
For Saddam, Middle East analysts say, the options are few. One is to take on the military forces facing his country. The problem here is that he has no military allies. Even Iran has thrown its moral weight behind the foreign forces in Saudi Arabia.
A second option for the Iraqi leader would be to withdraw his Army from Kuwait. But analysts say the chances of this happening in the near future are slight.
``To give up Kuwait, having just abandoned all his territorial claims on Iran over which he fought an eight-year-long war, would leave him with nothing,'' says a British diplomat who has recently served in Baghdad.
Analysts believe that the third option, and the one most likely to be adopted by Saddam, is simply to sit tight behind the human shield of Western hostages and wait. While the economic blockade is beginning to bite, some observers believe Iraq could survive for many weeks, possibly months, without undue suffering.
Meanwhile, Iraq yesterday declared Kuwait its 19th province, and renamed the city of Kuwait Kadhima.
Over recent days, diplomats say, there have been signs that Iraq is looking for a way out of the Gulf crisis. They note that while Western embassies are besieged in Kuwait, Iraqi troops have been told not to use force against them. US intelligence reports indicate that Iraqi ships have been told to comply with orders from the foreign naval forces in the region. And belligerent threats from Baghdad against the West and Western-oriented Arab states are now wrapped in appeals for dialogue.