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U.N. arms envoy Rolf Ekeus said Monday he had resolved a crisis with Iraq over weapons monitoring and saw no need for military action.

"We feel that on the commission side we would recommend the Security Council accept or express its approval of these arrangements we arrived at," said Ekeus, head of the U.N. Special Commission dismantling Iraqi weapons programs.Ekeus said the agreement, clearing the way for a wide-ranging political and technical dialogue, was not directly linked with oil talks being conducted in New York but could make it easier to reach a deal for limited, resumed oil sales.

Ekeus arrived Thursday to try to head off a possible U.N. military strike on Iraq over its refusal to allow U.N. surveillance cameras at the Yawm Al-Azim and Al-Rafah missile sites, 45 miles south of Baghdad. Iraq rejected a U.N. compromise to seal key equipment at the sites until the camera issue was resolved.

Iraq contends it is using the sites to test short-range missiles, which are allowed under the cease-fire pacts. The United Nations wants to ensure there is no testing of long-range missiles, which are prohibited.

The Security Council had warned Baghdad of "serious consequences" if it continues to defy U.N. resolutions. Washington would not rule out the use of force.

On Jan. 17, after Iraq blocked U.N. inspection flights, the United States fired 45 missiles at a Baghdad factory linked to Iraq's nuclear weapons program.

On June 27, U.S. warships fired 23 Tomahawk missiles at an intelligence complex in Baghdad, killing at least six civilians. Washington said it struck in retaliation for an alleged plot to kill former President Bush during his visit to Kuwait in April. Iraq has denied involvement.

Along Al-Rasheed Street Monday, Iraqi businessmen, shop owners and idle taxi drivers tuned their radios to foreign news broadcasts.

"In my dawn prayer, I appealed to Allah for the success of the talks," said Abu Jihad, a taxi driver. "There are many, many like me."

On Sunday, Ekeus met with Tariq Aziz, Iraq's deputy prime minister and its main international negotiator, and Foreign Ministry officials. He said they were joined by Riyadh al-Qaisi, head of the Iraqi delegation conducting talks on a one-time sale of oil.

Diplomats in New York said last week that Iraq was close to agreement on a deal to sell $1.6 billion in oil to finance the purchase of food and medicine and provide money for a special reparations fund for the gulf war.

The United Nations imposed a worldwide embargo on Iraq after its forces invaded Kuwait in 1990.