The leadership of the Palestinian movement has decided in a meeting here to begin discussions with King Hussein on the Palestinians' relationship with Jordan.

Reliable sources in Amman, Jordan, said the proposed dialogue would be confined to possible political coordination and to relations between Jordan and a future Palestinian state. The sources said any military discussions between the two sides would be premature.

The announcement here of plans to open talks with Hussein followed a three-hour meeting last night of the 40-member Palestine Central Council, in which commando leader Vasser Arafat took part. A spokeman said the council also recommended that Palestinian-Syrian ties be strengthened.

There was no official reaction in Jordan, but the announcement was seen in Amman as a positive response to Jordanian initiatives. Informed sources in Amman said Jordan began investigating ways of improving relations with the Palestinians immediately after Egyptian President Anwar Sadat said recently that there should be a formal link between Jordan and any future Palestinian state.

Relations between Hussein and the Palestinians have been strained since the Jordanian army expelled Palestinian commandos after a battle in September 1970.

The council did not say when talks with Jordan would begin but observers thought it would be before the larger Palestine National Council meets, probably in Cairo late next month.

In other Mideast developments:

Relations between Egypt and the Soviet Union appeared to worsen as newspapers of the two countries continued to criticize each other's governments in the aftermath of last week's rioting. The semi-official Cairo newspaper Al Ahram accused Moscow of helping to fuel the protests and Tass, the Soviet news agency, accused the Egyptian press of launching an anti-Communist campaign.

Bahrain has decided to raise its crude oil price by 5 per cent this year in line with neighboring Saudi Arabia, Finance Minister Ibrahim Abdel Karim was quoted as saying in the Bahrain newspaper Akhbar Khaleej. Bahrain is not a member of the Organization of Petroleum Exporting Countries.

Kuwait announced after a meeting with Mozambique officials that it is prepared to make loans to enable Mozambique to carry out plans for agricultural and industrial development.