Regional Outlook : A Gulf Puzzle: Does Peace Have a Chance? : There is little real optimism that war can be averted but some glimmers of hope are emerging.

With increasing intensity since the Persian Gulf crisis began on Aug. 2, the United States and Iraq have been hurtling toward a precipice beyond which lies war and lasting agony.

The world is watching anxiously, wondering if there is any formula short of bloodshed under which President Bush and Iraqi President Saddam Hussein can resolve their impasse. The situation is trigger-tense. Even an accident could touch off a war.

The question becomes more urgent daily: Is there a way back from the brink?

Early returns on the diplomatic front are not encouraging. A chastened U.N. Secretary General Javier Perez de Cuellar, who had hoped to see some sign of flexibility in weekend talks with Iraq’s Foreign Minister, Tarik Aziz, left the region deeply disappointed and alarmed by the gravity of the situation.

He said any fresh U.N. diplomatic initiative will await the outcome of next weekend’s hastily planned summit meeting between Bush and Soviet President Mikhail S. Gorbachev in Helsinki. Some hope that the former superpower rivals can devise a scheme that would peaceably end the standoff in the desert.

Also, Jordan’s King Hussein continues to try to play peacemaker, and a deeply divided Arab League is attempting to find a diplomatic end to the bitter split within its ranks. Even Libya’s Moammar Kadafi has come up with a peace plan.

Yet there remains deep skepticism that war can be averted. A senior Egyptian military officer places the likelihood of a diplomatic resolution at “two percent.” American officials are publicly hopeful that Hussein will back down in the face of international pressure, U.N. sanctions and the threat of military action. But privately they concede that few in Washington believe he will.

“Both sides are in a corner,” said a Western analyst with long experience in the Middle East. “Saddam’s mental makeup is such that he is not going to back down. I don’t think Bush, representing the West, is prepared to allow him the face-saving things that he would need to get out. It is headed at least to a stalemate--and that leads to confrontational events.”

Still, the diplomats continue their efforts.

Here is a look at the key problems, players and possible options in the Persian Gulf puzzle.

The Issues:

Analysts say any resolution of the crisis must address five fundamental questions:

* The status of Kuwait.

* The thousands of foreign hostages that Baghdad is holding.

* The worldwide economic quarantine of Iraq.

* The future of Hussein and his military machine.

* And the long-term security of the Middle East.

The central problem--the issue that began the confrontation, and the key to ending it--is Kuwait.

Bush, backed by the U.N. Security Council, is unswerving in his demand that Hussein surrender Kuwait and restore its royal rulers, the Sabah dynasty. Yet, Hussein has given no indication that he will consider doing so. Last week, Baghdad issued new maps of the Persian Gulf that show Kuwait as Iraq’s 19th province.

Short of Hussein’s unconditional capitulation, is there any deal that would be acceptable to the United States?

Some think it’s possible to devise an arrangement that would simultaneously restore Kuwaiti sovereignty and accommodate Hussein’s initial grievances with the Kuwaiti regime over oil prices, territory and debt.

On paper, the possibilities seem numerous. Iraq might pull its troops out of Kuwait in return for a U.S. troop pullout from Saudi Arabia; both armies could be replaced by U.N. and Arab League peacekeeping forces. The hostages might be released in return for a pledge by the United States that it would make no reprisals, and the U.N. embargo could be lifted. Kuwait might hold elections to form a new democratic government that would not necessarily include the Sabah dynasty. Iraq might be guaranteed access to Persian Gulf ports for its oil. The long-term security of the region would be ensured by the peacekeeping forces.

Jordan’s King Hussein is trying to broker just such a deal. Jordanian officials argue that the call for unconditional surrender puts Iraq’s Hussein in a corner from which he would rather fight than compromise. They also have been hard-pressed to hide their antipathy for the Sabah family. “The Sabahs are gone as far as we are concerned,” a prominent member of the Jordanian Parliament said.

But U.S. officials aren’t buying King Hussein’s plan, dismissing it as a thinly disguised effort to pay off Saddam Hussein for pulling back his forces. Withdrawal from Kuwait is “non-negotiable,” senior Bush Administration officials insist.

The hostages, too, are pawns in the chess game. A senior Arab military official scoffs that Hussein is only holding the thousands of foreign hostages he has interned in Iraq and Kuwait in an effort to obscure the issue of Kuwaiti sovereignty--hoping that the West will be satisfied with the hostages’ freedom instead. “He’s playing for time,” he said. “His objective is to keep Kuwait.”

But Bush has vowed that the existence of the hostages will not deter him from taking military action to achieve his objectives, even if it leads to their certain deaths. And he has conspicuously balked at suggestions that he pledge to negotiate if the hostages are released. National Security Adviser Brent Scowcroft reaffirmed last week that after Kuwait is restored and the hostages are liberated, “We’re prepared to talk about anything.”

The prospect that the embargo will work is a hope confined mainly to the West. Saudi Arabia, the country most immediately threatened by Iraqi forces, has publically shifted slightly from its implacably hawkish posture of the early days of the crisis, emphasizing in its latest official statements support for diplomatic efforts to secure a peaceful Iraqi withdrawal from Kuwait. Over the weekend, for example, the country’s defense minister, Prince Sultan ibn Abdulaziz told reporters that U.S. forces would be allowed to launch an attack from Saudi soil only if it were necessary for the defense of the kingdom.

Privately, however, Saudi officials remain deeply skeptical. Indeed, Riyadh’s greatest fear is that the United States will settle for a superficial diplomatic solution and pull its troops home, leaving Saudi Arabia and its neighbors facing an Iraqi monster that could soon rise again against them.

Accordingly, many Saudi government leaders say privately that the only way out is through Hussein’s death. “We will get him out one way or another,” a Saudi official said. “We all know, in the end, Saddam Hussein is going to be gone, and at that point, all these questions (about diplomatic efforts and the embargo) are irrelevant.”

Beyond these immediate concerns lies perhaps the most crucial question of all: Can the security of the region be assured as long as Hussein--and his military machine--remain in power?

The Bush Administration is divided. Some officials argue that world opinion, backed by a large, permanent peacekeeping force, can effectively contain Hussein. Others contend, however, that Hussein must be toppled and his military machine dismantled before regional balance can be restored.

Even if this is accomplished, however, problems will remain. Iraq could rebuild its nuclear, chemical and ballistic-missile installations, even if they are destroyed in battle. “Technology is in the mind, it’s not in the facilities,” said a U.S. official in the Mideast. “Basically, what you need to have is a political decision in Iraq not to devote resources to these kinds of things.”

And, many ask, who would replace Saddam Hussein if he were ousted? Hussein long ago eliminated any credible opposition, and there is no assurance that the forces that might rise to take his place would be any less militaristic or more kindly disposed to the West.

These questions are being debated long into the night in Washington and other world capitals. Everybody agrees that “whatever happens, we’ve got to win,” a senior member of the Bush inner circle said. “But not everybody agrees exactly on what winning is.”

The Peacemakers:

President Bush has drawn his “line in the sand,” and so far Hussein hasn’t appeared intent on crossing it. But a standoff is a long way from peace.

Perez de Cuellar’s visit to Amman, Jordan for his weekend talks with Iraqi Foreign Minister Aziz had given some cause for hope. The secretary general is held in high regard in the Middle East, having coaxed along the 1988 cease-fire that ended the long Iran-Iraq War. And the United Nations itself enjoys more prestige than at almost any time in its 40-year history, having acted quickly and unequivocally in response to the Iraqi invasion of Kuwait on Aug. 2. Some see it as the only available forum for a peace settlement--the only way Hussein can avoid seeming to surrender to the United States.

But after two days of talks, the U.N. leader told reporters: “I came with the hope of moving ahead. Unfortunately, I have not been very successful. I am being very honest. I am not playing diplomacy with you. I have been disappointed.”

He cautioned that “there should be no illusion” regarding “the gravity and dangers” of the Persian Gulf crisis.

Aziz failed to budge from Iraq’s insistance on what it calls an “Arab solution” that would deal with a number of critical regional problems, including Israeli occupation of the West Bank and Gaza Strip, without interference from foreign forces.

Jordan’s Hussein, who embarked on his own 10-nation peace-seeking mission last week, was offering a version of Saddam Hussein’s plan--a pan-Arab approach that would tie an Iraqi withdrawal from Kuwait to a more comprehensive Mideast settlement that would include resolution of the Palestinian issue. Iraq would be permitted to negotiate its grievances with Kuwait as part of a series of talks on Arab-Israeli and Arab-Arab conflicts. And the talks would create a new multinational buffer force to ensure the security of Saudi Arabia and other Persian Gulf nations that opposed Iraq’s takeover of Kuwait.

A practiced survivor throughout his 37-year reign, King Hussein has walked a tightrope between the demands of Arab nationalism--with its anti-Western tinge--and a personal desire to maintain good relations with the West. But keeping his balance during this crisis has strained even his formidable ability to equivocate. On one side, Iraq’s invasion raised the banner of Arab unity and glory to which verbally, at least, King Hussein has always adhered. His cozying up to Saddam Hussein has come in part because of the threat on his own borders and in part because of the appeal the Iraqi dictator has to Arab masses, who have always been a bit suspicious of the Saville Row tinged Jordanian monarch.

But the Western response to King Hussein’s overtures clearly took Jordan aback. The king looked like an outsider, possibly even a radical, in the face of the virtual unanimity in the United Nations for a stronger stand. And Jordan stalled on enforcing a trade embargo on Iraq while it emptied its silos and warehouses of goods bound for Baghdad.

King Hussein claims that Jordan’s position was misunderstood, and that by refusing to condemn Iraq he was only trying to maintain his posture as an honest broker.

Roadblocks:

Pessimistic commentators say that having staked their own prestige and the honor of their countries on this conflict, Bush and Saddam Hussein must come to blows to resolve their differences. If Hussein blinks, these analysts contend, his generals will devour him. If Bush “wimps out,” they say, his presidency will be finished and his reputation will be in ruins.

Others, such as Perez de Cuellar and Bush adviser Scowcroft, see another way out. Scowcroft argues that with the massive outpouring of world opinion against Iraq--and the growing military forces arrayed at its border--Hussein has already been defeated. He has everything to gain by pulling back now, before blood is shed, and while he is still in a position to define the outcome in some face-saving way as a gain for Iraq.

This same argument holds that the embargo will quickly weaken the Iraqis’ will. Food rationing began last Saturday in Baghdad, bread lines are commonplace and prices of all consumer goods already are up 30% to 40%. To be sure, Iraq has suffered privation before--notably during the 1980-88 Iran-Iraq war--but never without aid from the Soviet Union and sympathetic Western nations.

Moreover, the longer Hussein holds out, the greater the military force he must face. The United States will not complete its buildup until the end of September, just about the time the stifling summer heat breaks and makes offensive operations more attractive.

Others argue, however, that time works to Hussein’s advantage. He reportedly has three to four months’ worth of food stores. The embargo is leaking from a number of cracks. The plight of the hostages eventually will soften the West’s resolve and Americans are a notoriously impatient breed, these analysts say.

Under this scenario, Arab unity would crack in the face of the growing presence of American troops. The American public would grow increasingly restive. And terrorist attacks would cast doubt over whether defending Persian Gulf monarchies and $20-a-barrel oil is worth the cost.

The Outlook:

A real danger, though often not voiced, is a war brought on by U.S. impatience and overly hasty response to a perceived provocation. Pentagon analysts say the U.S. military is not going to let 200,000 troops sit indefinitely in the desert and on warships in the gulf. It either will fight or come home.

“This is not going to be allowed to become some kind of Arabian version of the European central theater,” said a U.S. official in Saudi Arabia. “As the months go by, the military options increase. . . I think if you go too far down the road with nothing happening, then I think you are forced more and more to look at a military option.”

Adds an experienced Western diplomat based in the Middle East: “We all pray there is a solution whereby Iraq backs down. Maybe in a month or two sanctions will have bitten into his economy. The policy may not work, but it’s the only policy we’ve got.

“But if you have a large military buildup it’s quite difficult just to send them all home again. The two sides are in a head-on collision at the moment.”

Times staff writers Dan Williams in Jordan, Kim Murphy in Saudi Arabia, Nick B. Williams Jr. in Bahrain, Marjorie Miller in Cairo and Robin Wright and Jack Nelson in Washington contributed to this article.