NICOSIA, Cyprus — Iraq and Kuwait have agreed to hold direct talks this weekend to try to resolve their taut confrontation peacefully, Egyptian President Hosni Mubarak announced Wednesday in Cairo.
Mubarak, who undertook a whirlwind tour of both Persian Gulf neighbors Tuesday to mediate the oil-policy and territorial dispute, told reporters that Iraqi and Kuwaiti representatives will meet Saturday or Sunday in Jidda, Saudi Arabia.
He said Iraqi President Saddam Hussein, whose official newspaper Wednesday accused the United States of interference in the conflict, has agreed to stop his verbal attacks on Kuwait.
Mubarak also urged the United States, which on Tuesday announced "short-notice" naval maneuvers for American warships in the gulf, not to escalate the conflict.
Official Iraqi radio said Wednesday that Hussein has summoned U.S. Ambassador April C. Glaspie for talks, but no details were released.
Earlier in the day, Iraq kept up its martial drumbeat, with the government daily Al Jumhuriya charging that Kuwait "is implementing an American-Zionist plot to show that America is playing the role of protector in the gulf."
"Let Sabah al Ahmed al Sabah (the Kuwaiti foreign minister) and his American masters in the White House know that Iraq will not succumb and will not let anyone encroach upon its rights," the newspaper declared.
Later, in an apparent endorsement of direct talks with Iraq, the Kuwaiti prime minister, Sheik Saad al Abdullah al Sabah, reportedly told a Kuwait news conference that "Kuwait wanted and still wants . . . to meet our brothers in Iraq to reach an understanding in a brotherly atmosphere on a formula which will serve the interest" of both countries.
According to the Kuwaiti news agency, Saad said, "We will consider what happened a cloud which will soon go."
Since last weekend, when it deployed two armored divisions of 30,000 troops, backed by an estimated 200 tanks, along its disputed border with Kuwait, Hussein's regime in Baghdad had raised the level of rhetorical firepower.
Kuwait, the Iraqi government paper declared Wednesday, "should be aware that those who are threatening the interests of the Arab nation and conspire against it will not be protected by foreigners." It added: "This is the Iraq of Saddam Hussein. This should be enough."
Even discounting the hot flourishes of rhetoric, the Iraqi regime has appeared determined to get its way in the rift with Kuwait, a rift that Hussein triggered two weeks ago in a speech celebrating the 11th anniversary of his rise to power.
He and his ministers have accused the oil-rich sheikdom, in tandem with the United Arab Emirates, of driving down world oil prices by overproduction, thereby denying Baghdad billions of dollars in revenue--$14 billion in 1990 alone.
At a meeting of the Organization of Petroleum Exporting Countries that got under way Wednesday in Geneva, Iraqi Oil Minister Issam Abdul-Rahim Chalabi is expected to demand a target price of $25 a barrel, $7 above the current unachieved target. Strict restraints on production would be imposed to drive up the price under the Iraqi plan. (Story, D1.)
Most Middle East analysts have insisted that the confrontation is basically about money: Iraq is desperately short of hard-currency reserves to rebuild its war-damaged economy and can boost them only with oil revenue.
Iraq is also is heavily in debt to Western bankers, who are reluctant to make new loans until payments are made on the old ones. Meanwhile, Baghdad owes an estimated $40 billion to Arab oil countries, which supported its war against Iran. Hussein wants those debts erased, insisting that Iraqis died to protect the oil states from Iran's armies.
The analysts say they still doubt that Iraq would go to war with an Arab neighbor to resolve the conflict. But the crisis has now taken on overtones of pride and politics that may make it difficult to defuse.
On Tuesday, Mubarak had pressed his formula for easing tensions and discussing a solution. Mubarak received "positive responses for his good offices from the Iraqi and the Kuwaiti leaderships," the president's top Arab affairs adviser, Osama al Baz, said Wednesday in an interview with Egypt's official news agency.
The adviser said "elements of progress" had "crystallized" during Mubarak's one-day circuit of Baghdad, Kuwait and Jidda, where he met with Saudi Arabia's King Fahd. In Kuwait, Reuters news agency quoted unidentified Arab diplomats as saying Hussein already has given Mubarak assurances that his army will not cross into Kuwait.
According to reports from Cairo, Mubarak had been working on a four-point plan that calls for Egyptian mediation; talks among the Iraqi, Kuwaiti and Egyptian foreign ministers; the renouncing of the military confrontation, and an end to the propaganda campaigns in the Iraqi and Kuwaiti press.