Libyan leader Moammar Gadhafi expects the war in the Persian Gulf to spread to the Soviet Union's borders and ultimately lead to World War III.

In an interview on the ABC news magazine "20/20" airing Friday, he said:"I think the war is going to extend to the borders of the Soviet Union and the borders of the Soviet Union and Iran and that's going to provoke all the Islamic nations, and that would lead to a third world war, and we will pay very dearly for it.

"I do not see any reason for this war," he told interviewer Barbara Walters via satellite from Tripoli. "And I think everybody who's participating in this war is crazy."

However, he said it would be understandable for Arab nations to participate in the war because "they cannot be neutral."

"Especially when it becomes clear to them that the whole thing is not about the liberation of Kuwait . . . especially after all that kind of help that started going to Israel.

"This is going to provoke all the Arab nations, and it's going to make it a third world war."

He said he sent a message to Iraqi leader Saddam Hussein trying to persuade him to get out of Kuwait "and to stop the war."

"But he (Saddam) . . . answered he will stay in Kuwait, even if it leads to a war."

He said he would have sided with Saddam had Iraq not invaded Kuwait.

However, Gadhafi told Walters that if what the Libyan leader characterized as aggression by the United States or the allies continues after Iraq is driven from Kuwait, he will align with Iraq.