New setback for Israelis in battle of the embassies

Israel has suffered its biggest single loss to the Arabs so far in the continuing battle of the embassies. The Netherlands government decided Aug. 26 to shift its embassy in Israel from Jerusalem down to the coastal plain city of Tel Aviv.

The question now is whether this Arab victory on the embassy question is but the first successful installment in a new wave of Arab pressure on Israel through the international community -- more particularly through the United States and Western Europe.

Even further, is the ultimate step in that wave of pressure a new Arab oil boycott? Recent statements by Crown Prince Fahd of Saudi Arabia appear to revive that option for the Arabs.

As far as the battle of the embassies is concerned, the Dutch decision has particular impact for Israel for two reasons:

1. The Netherlands had long been the only member of the North Atlantic Treaty Organization and of the European Community to have its embassy in Jerusalem instead of in Tel Aviv. In Israeli eyes, this bespoke a courageous and unusual sympathy for the Israeli cause and for the Israeli contention that Jerusalem was Israel's legal capital despite a United Nations resolution of 1947 declaring it should be under international control.

2. The Netherlands until now had resisted Arab pressures to be (as Arabs saw it) less pro-Israeli and more evenhanded on Middle East issues. Back in 1973-74 , the Netherlands was singled out as a prime target, along with the US, of the Arab oil boycott, but the Dutch then stood their ground.

What has caused the pendulum to swing away from Israel on this issue now?

The immediate cue for the battle of the embassies -- of which there were 13 in Jerusalem a month ago -- was Israel's virtually simultaneous moves (1) to reaffirm all Jerusalem, including occupied Arab eastern Jerusalem, to be the country's eternal capital; and (2) to move the Israeli prime minister's office to east Jerusalem as an earnest of the finality of that reaffirmation.

Saudi Arabia and Iraq, hitherto unlikely partners but significantly the Arab world's two biggest oil producers, promptly got together and said they would cut diplomatic and economic relations with any country recognizing Jerusalem as Israel's capital. The Jerusalem embassies began to fall. Four of the 12 Latin American countries that, along with the Netherlands, had their diplomatic missions in Jerusalem, now have decided to make the move to Tel Aviv.

Israeli Foreign Minister Yitzhak Shamir said earlier this month on Israel radio that Arab oil pressure was a danger to the whole civilized world, not only to Israel -- and very few states could resist it.

But commenting editorially on the setbacks for Israel on the embassy question , the Jerusalem Post said they were "the wages of Israel's defiantly formal assertion of sovereignty over Jerusalem 'in its entirety' as 'the capital of Israel' . . . .

"An act of 'great folly,' as [Jewish Agency and World Zionist executive chairman] Arye Dulzin has rightly called it, it has already done Israel more harm than all the deliberate machinations of its enemies -- whether in Riyadh or in Cairo, in Moscow or in Washington -- could have devised. And the worst is most likely yet to come."

In making that ominous final statement, the Jerusalem Post was aware of one of the most significant utterances for many months to come out of Riyadh, the capital of Saudi Arabia. Crown Prince Fahd, the effective head of the Saudi government, issued a declaration Aug. 13 in which there were carefully worded questions full of moment for those dependent on Saudi oil:

"Today, after Israel has completed its usurpation of Palestine in its entirety, in addition to other Arab lands, it proclaims the whole of Jerusalem as its eternal indivisible capital. . . . So the question must be asked: How did moderation benefit us? Is this the West's idea of a just peace?

"So is not the call . . . for a holy war, long and relentless, the only answer to religious, racist, Zionist arrogance? Will the world blame us if, after today, we take matters into our own hands? . . ."

Implicit in these princely observations is Saudi frustration at the failure of the US to produce results on the Palestine issue in response to what Saudis see as their efforts to rein in the wilder Arabs both on opposition to the US-sponsored Middle East peace process and on oil price increases.

If Prince Fahd's words were not just rhetoric, it is on oil -- not arms -- that the first sign of carrying out the implied threat to "take matters into our own hands" is likely.