Article: Truce in Gulf Seen Fortifying Arab Axis Now Assisting Iraq

A lasting truce after eight years of war in the Persian Gulf may solidify a new Arab axis linking Iraq, Saudi Arabia, Egypt and Jordan that`will compete for influence in the region with revolutionary Iran while exerting more diplomatic pressure on Israel to settle the Palestinian question,`diplomatic sources said yesterday.

If the cease-fire called`Monday for Aug.`20 by the United Nations Security Council takes effect, diplomats and business executives say western nations also will be propelled into bidding to participate in reconstruction of the two belligerents' war-battered economies-with contracts underwritten by the massive oil reserves held by both nations.

The United States, which ...

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