On the eve of his first venture in a Middle East diplomacy, Secretary of State Cyrus R. Vance told the Senatae Foreign Relations Committee yesterday that he expects progress toward an Arab-Israeli settlement by the second half of 1977.

According to informed sources, he told the closed meeting that the U.S. objective is the reconvening of a Geneva-type conference to produce progress in the seemingly intractable and dangerous dispute. But he declined to be specific about how to solve the problem of Palestinian representation, which has blocked resumption of a Geneva conference for many months.

Vance is scheduled to leave Monday night on a week-long trip to Israel, Egypt, Lebanon, Jordan, Saudi Arabia and Syria to explore the chances for peace agreements in the area. In an interview with The New York Times published yesterday, he said he would like to explore in depth with Arab leaders "increasing talk" that Palestinians are moderating their views on a settlement.

In keeping with existing U.S. policy, Vance does not intend to speak directly to representatives of the Palestine Liberation Organization, the State Department reiterated yesterday.

Vance told the Foreign Relations Committee that before leaving Monday, he expects to make his recommendation to President Carter regardmendation to President Carter regarding U.S. sale of sophisticated "concussion bombs" to Israel. Vance not explicity state his position but volunteered several dangers of such a sale without mention of possible advantages, sources said.

After the committee meeting Vance declined to make any substantive comment on the arrestof Soviet disident Yuri Orlov, saying only that he has been kept informed of all developments and that he did not believe the arrest is a challenge to the Carter administration's position on human rights.

However, Sen. Henry M. Jackson (D-Wash.) said in a speech that the arrest of Orlov and other dissidents may be "a deliberate test of the will and staying power of President Carter." Jackson said Carter had made a good start by commenting on Soviet human rights violations, but added that "determined follow-up will be of central importance."