Nato ambassadors met for the fifth time in three days today to seek a deal over whether those training Iraqi security forces should come under the command of the US-led coalition.
Diplomats said differences between the United States and France had been whittled down to the single, politically charged issue of command and force protection arrangements for a small Nato mission that would go to Iraq to coordinate the training.
"Someone's got to give," a Nato diplomat said. "Either we find some middle ground, or a fudge, or a gentleman's agreement, or else there's a collapse."
Washington argues the Nato presence must be under the wing of the US-led Multinational Force to ensure its safety and protection in a dangerous environment. But France is suspicious that it may be an attempt to put Nato into Iraq through a back door.
Diplomats said they expected discussions to continue all day, with at least two meetings. A Nato official said he was reasonably confident there would be an agreement, noting that all sides had made concessions.
France had conceded there would be a small collective Nato presence inside Iraq, which President Jacques Chirac had opposed last month at the alliance's Istanbul summit, while the United States had dropped demands for collective Nato funding of the training operation.
Diplomats said there were intensive consultations with capitals overnight to resolve a standoff that has put the spotlight on the lingering mistrust between the two countries more than a year after they fell out over the US-led attack on Iraq.