Willing to Blockade Iraq to Stop Any Oil Shipment, Bush Says : Sanctions: But the President reports that the U.N. embargo has virtually halted world trade with Baghdad.

President Bush said Saturday that he would be willing to order a naval blockade of Iraq, while noting that world trade with the Middle East aggressor has come to a virtual halt already because of the embargo approved by the U.N. Security Council.

“With the exception of one small tanker, I believe it was, no vessels from Iraq or Kuwaiti ports are trying to get out of there with cargo, with oil cargo,” the President said, adding: “No shipping from Iraq is coming through the Strait of Hormuz.”

Asked whether a decision had been made to impose a trade quarantine, Bush replied: “I’ve made the decision in principle, and I think most other leaders have, that the sanctions will be fully enforced and that exports from Iraq will not get into the market.

“What we want to do is see that no oil comes out through the Strait of Hormuz. And if it requires naval vessels to see that that happens, fine.” he said. The strait is a narrow stretch of water leading from the Persian Gulf, on which Iraq has its only deep-water port, to the oceans of the world.

Meanwhile, the U.S. military presence in the Middle East continued to grow, with a contingent of Marines dispatched from Camp Pendleton and other troops from Ft. Campbell, Ky. The Pentagon said the units are equipped with missiles and other sophisticated weapons.

In Kennebunkport on the first full day of his summer vacation, the President engaged in personal diplomacy to encourage international participation in the military effort to prevent Iraq from launching an invasion of Saudi Arabia from its position in Kuwait.

Bush telephoned President Hosni Mubarak of Egypt, King Fahd of Saudi Arabia and the leaders of Bahrain and Qatar to discuss the Middle East crisis and the international campaign to isolate Iraq and its leader, Saddam Hussein.

The goals of U.S. policy in the region are to use a multinational military force to keep Iraq from attacking Saudi Arabia while relying on the trade embargo to pressure Hussein to withdraw from Kuwait.

White House Press Secretary Marlin Fitzwater said that no Iraqi oil is leaving Turkey or Saudi Arabia. A Turkish oil terminal on the Mediterranean Sea and a Saudi terminal on the Red Sea are key transit points for 90% of Iraq’s oil exports.

Bush used extreme caution in discussing whether he would like to see Hussein overthrown from within. Officials have said privately that such a move by disaffected Iraqis is the underlying goal of U.S. policy.

“We’re not prepared to support the overthrow,” Bush said. But, referring to a policy intended to force the withdrawal of invading Iraqi troops from Kuwait, the President also said: “Whatever it takes to have our objectives met is what should take place.”

Bush was asked if his objective includes overthrowing Hussein. “I’ll just leave it sit out there and everybody can figure it out,” he replied.

The President spoke to reporters from the back porch of his vacation home. He was joined at his home by Secretary of State James A. Baker III, National Security Adviser Brent Scowcroft, White House Chief of Staff John H. Sununu and several deputies.

The advisers gathered to review with Bush the secretary of state’s trip to Turkey and Brussels, where Baker met with NATO foreign ministers, and to examine potential naval operations near the Turkish and Saudi ports through which the bulk of Iraqi oil is shipped.

The President is backing up his policy with a rapid deployment of troops from the United States to the tense region. U.S. Army airborne and mechanized brigades, Air Force F-15 fighter jets, three U.S. Navy aircraft carrier battle groups and a large contingent of Marines have either arrived in the Middle East or are on their way in air and sea lifts.

Reporters asked Bush if he considers it likely that Iraqi citizens will rise up against Hussein. The President replied:

“That sometimes happens when leaders get so out of touch with reality that they commit their country to outrageous acts. That does happen. And I know that some countries around the world are hoping that that will happen in this situation. But we’ll wait and see.”

Pressed later on the same point, Bush said he hopes that international action will produce “an Iraq that is prepared to live peacefully.”

“If that means Saddam Hussein changes his spots, so be it. And if he doesn’t, I hope the Iraqi people do something about it so that their leader will live by the norms of international behavior that will be acceptable to other nations,” the President said.

The Administration continued to refrain from describing as hostages about 3,500 Americans in Kuwait and Iraq who have not been permitted to leave the two countries.

Officials have said that calling them hostages would only inflame the situation, increasing their potential “value” to Hussein.

“Nothing has been demanded or asked in connection with permitting them to leave the country,” Baker said.

“As far as we know, no American citizens have as yet been mistreated,” he added, noting, however, that the situation runs “against all international norms.”

Bush declined to discuss the ultimate size of the U.S. force being sent to Saudi Arabia.

The Pentagon’s reports of an initial deployment of about 4,000 was quickly eclipsed by unofficial estimates of 50,000 and then 90,000. At least one report subsequently has estimated the possible eventual total as high as 250,000 troops if Iraq invades Saudi Arabia.

Fitzwater said the Administration would not provide “any numbers on troop strength for obvious national security reasons.”

While such reports could encourage Iraq to strike before the forces grow any larger, officials said, the unofficial figures also serve as a warning to Hussein that the United States is willing to pour considerable resources into the mission.

Throughout the day, Bush mixed work with recreation, sandwiching the 90-minute meeting with his advisers between a morning ride on his speedboat Fidelity and an afternoon on the Cape Arundel golf course.

On the golf course, Bush told reporters he might make several trips back to Washington during his vacation. At least one, next Wednesday, is already scheduled to allow him to meet with officials for an update on the Iraq situation.

The President stressed that “there’s still room for more diplomacy” in the effort to persuade Iraq’s Hussein to step back from Kuwait. He called attention to the the resolution adopted Friday by a majority of the members of the Arab League, recommending that Arab nations commit military forces to the defense of Saudi Arabia and any other threatened states in the Persian Gulf.

“I think (Hussein) does see today more clearly than he saw yesterday at this time that the world is united against him,” the President said.

Bush also expressed confidence that excess capacity within the oil industry would allow the international oil market to remain stable despite the disruption of exports from Iraq and Kuwait.

In a written statement, Fitzwater praised Venezuela and Iran for pledging to make up any oil shortfalls and said that as a result of high oil stocks in the United States, “America is in a very positive situation in terms of its ability to withstand existing oil disruptions.”

He also said the “military participation” offered by Canada, Australia, West Germany, France, Belgium and Britain “signal a high degree of unity.”

Times staff writer John M. Broder, in Washington, contributed to this story.