At the height of this spring's war between Ethiopia and Somalia, Soviet Ambassador Amatoly Barkovsky was summoned to the Iraqi Foreign Ministry.

Foreign Minister Sadum Harradi told the Soviet envoy that Soviet planes were not to use Iraqi airfields or even fly through Iraqi air space - in resupplying Cuban forces fighting on the Horn of Africa.

The incident illustrates both the strains in Iraq's relationship with Moscow and Baghdad's determination to act strictly in what it views as its own self-interest.

As the first of what may ultimately be hundreds of billions of petrodollars begin flowing into the country's treasury, the government's vision of Iraq's future - and its role in the world - has started to change.

The government has already embarked on a series of long-range adjustments that have produced some short-term paradoxes in Iraqi foreign policy.

While Iraq remains bound by a 15-year friendship treaty with the Soviet Union, Baghdad appears increasingly eager to obtain the trade and technological benefits that can only flow from closer ties with the United States.

While Iraq continues to ritualistically rail against Zionism, Baghdad seems to be losing interest in the dream of using the Palestinian issue to unite the Arab world in one nation stretching from Morocco to the Euphrates.

While Iraq still supports terrorists (box), Baghdad has begun to think of itself as a wealthy oil state - a nation with many of the same concerns and vulnerabilities as the petroleumrich Persian Gulf kingdoms that it long has been trying to overthrow.

All of these signs of change - which can only be regarded as good news by the United States - remain tentative, and to some of Iraqi's neighbors, still a bit suspect as well.

Nobody really expects Iraq to turn overnight from an international maverick into the bulwark of a stable international order. Baghdad itself makes it clear that change will come slowly.

The Iraqis, for instance, feel that Egyptian President Anwar Sadat hurt only his own country by abruptly servering his ties with the Soviet Union. Baghdad is not likely to do the same.

The Iraqis are also likely to continue vilifying Israel and paying lip service to the dream of pan-Arab unity, if only for domestic political reasons.

And the Persian Gulf states - Saudi Arabia, Iran and Kuwait - remain unconvinced that Iraq's leaders are now more interested in teaming up with them than in toppling them.

But money - big money - and the tantalizing prospect of sharing in the Persian Gulf's prosperity is having its impact on the Iraqi government's perspective.

The transformation of Iraq from an international beggar that had to borrow money from the Saudis just four years ago to a country that could ultimately prove the richest in the Middle East has plainly got Baghdad rethinking its future.

That would not appear to be particularly good news for the Soviet Union.

Baghdad's relationship with Moscow has been based from the outset on the Soviet's willingness to supply Iraq - at a time when its credit ratings was not very high elsewhere - with large numbers of tanks and warplanes.

Since striking it rich on oil, however, Iraq has shifted almost half its military purchases to the West.

While taking care not to get caught in the spare-parts squeeze that crippled Egypt's military following Sadat's break with Moscow, Iraq has been negotiating with France to purchase sophisticated Mirages and Crotale surface-to-air missiles.

One reason for this turn toward the West lies in a sever Iraq disenchantment with things Russian.

After nationalizing the facilities of the Western oil companies, operating in Iraq in 1972, Baghdad signed an agreement for technical assistance with the Soviet Machine Export Organization.

"The Iraqis ended up with a pile of cast iron drilling bits and strings of broke pipe," laughs a Western oil company executive.

Today with cash in the bank, Iraq is determined to buy the best. Declares Minister of Information Saad Qasim Hamoodi: "Iraq intends to catch up with the latest technology - whatever the sources may be."

The impact of this economic pragmatism is already clear. Since oil prices quadrupled in 1973, Iraq's imports from the Soviet Union, Eastern bloc countries and China have dropped from 25 to about 9 per cent - while imports from the United States are up nine-fold.

A continuation of this policy seems likely to ultimately bring closer political ties with the West as well.

Last year, for example, Baghdad secretly proposed selling a large amount of oil directly to the U.S. Defense Department for stockpoling in America's strategic petroleum reserve.

Nothing came of that deal, but workers recently began putting a fresh coat of white paint on the building that houses the small U.S. Interest Section in Baghdad, giving rise to speculation that Iraq was considering restoring the formal diplomatic relations that it severed following the 1967 Arab-Israeli war.

That has not happened yet, even though Secretary of State Cyrus Vance told Foreign Minister Hamadi at the United Nations last fall that the United States was ready to resume full relations with Iraq at any time.

The problem, Iraqi officials say, remains Israel.

"The U.S.A. is still feeding Israeli military machine and helping her produce nuclear weapons," says Naim Hadad, a senior member of the Revolutionary Command Council. "The U.S. has been pursuing a policy against the Arab nation."

The Arab nation.

The ephemeral dream of the Arab nation - stretching from Iraq westward to Morocco - has tantalized Arab leaders ever since their countries began emerging from colonial rule.

Since the death of Egypt's President Gamal Abdel Nasser - who unsuccessfully tried at various times to unite his country with Libya, Syria, Sudan and Iraq - Baghdad's ruling Baathists have been the most fervid advocates of the pan-Arab goal.

Iraqi television broadcasts begin and end with the symbol of Baghdad radiating out airwaves linking the entire Arab world.

"But these pan-Arabic intentions are simply not accepted by anyone else in the Arab world," says a Western analyst.

With all the feuds and rivalries that seem to constantly have Arab countries at each other's throats, the only glue that has held the Arab world even briefly together has been the crusade against Israel.

Today, that glue seems to be losing its hold. Each of the four nations that once billed themselves as the "confrontation" states - Egypt, Jordan, Syria and Iraq - appears to be following a separate path.

Iraq briefly tried to rally the rest of the Arab world against Anwar Sadat last fall following the Egyptian leader's historic visit to Jerusalem. Even today, sun-faded posters of Sadat wearing a Moshe Dayan-style eyepatch can be seen along Sadooun Street, Baghdad's main thoroughfare.

But Iraq dropped out of the anti-Sadat cabal when it appeared in danger of losing the leadership role to Libya or Syria.

Ironically, although Cairo and Baghdad have still not restored diplomatic relations following that affair, commerce flows freely between the two capitals - and it is Syria's President Hafez Assad who is now the chief target of Iraqi emnity.

While Iraq and Syria both profess to embrace the Arab political philosophy called Baathism, Iraqi Baathists have long regarded Syria's Baathists in about the same way the pope viewed Martin Luther.

The long-smouldering feud between the Baathist rivals has erupted into the open, however, with a series of assassination attempts and bombings over the past two years.

"The Syrian Batthists bomb cars in our parking lots, set off bombs in our airports, and only recently exploded a case of dynamite that they sent us on Egyptair," charged a top Iraqi.

In reprisal, Iraq has turned loose Abu Nidahl, a Palestinian terrorist it sponsors, to stage a number of daring attacks in Syria and against Syrian diplomatic missions abroad.

Iraq also accuses Syria of attempting to aggrevate its dormant Kurdish problem by letting a faction led by Jellal Talabani mount raids from Syria against Iraqi military posts.

"Whenever they do come across the border," says Naim Hadad, a member of the ruling Revolutionary Command Council, "we annihilate them."

Given the open feud with Syria and Baghdad's disenchantment with Egypt, it is not hard to see why Iraq's focus seems to be turning away from the Fertile Crescent and toward the Persian Gulf.

"Iraq's weight as a state," a top Kuwaiti remarked recently, "is clearly tied to the gulf."

Five years ago, the notion of Iraq marching to the same tune as the Persian Gulf oil states would have seemed outrageously absurd.

The Iraqi Army seemed more likely to be marching into Saudi Arabia or Iran, or right through tiny Kuwait. Iraqi troops were regularly involved in border incidents with all three neighbors. In 1974, 50 soldiers were killed or wounded along the Iran-Iraq border in one battle alone.

While Baghdad called for the overthrow of the shah of Iran and the Saudi royal family, the shah retaliated by funneling CIA-supplied arms to the Kurdish minority fighting a war of secession in Iraq's north.

But with Iraq's emergence as a major oil power, the Persian Gulf feuds - which threatened to engulf the rivals' petroleum fields - began to make less and less sense.

The turning point in Iraq-Iranian relations came in 1975. At the Algiers conference of the Organization of Petroleum Exporting Countries, Shah Mohammed Reza Pahlevi and Iraq's Saddam Hussein exchanged the kiss of peace. Iran cut the supply line to the Kurds, and Iraq quickly moved to crush their rebellion.

Baghdad and Tehran both found the prospects of an escalating confrontation uninviting. Iraqi officials say that if a battle had taken place, it would have engulfed both countries' oil fields in the south.

"If that had happened," one Iraqi official said, "it would have not been good for us, for Iran, or for the West."

Baghdad also moved to mend fences with Kuwait and Saudi Arabia. Iraq signed a wide range of power, water and trade agreements with Kuwait last May.

As an indicator of how greatly the Persian Gulf situation has changed, Baghdad privately let it be known this spring that it was not the least bit opposed to the U.S. decision to sell 60 F-15s to Saudi Arabia - even though the Carter administration justified the sale by citing Iraq as the Saudis' potential enemy.

In fact, a month after the sale of the warplanes was approved, the Saudi defense minister, Prince Sultan, was warmly welcomed to Baghdad for a formal state visit.

"We don't want to bring about any changes in the Saudi government," an Iraqi Foreign Ministry official insisted in an interview. "And I think they are beginning to believe us, and our sincerity."

Well, maybe not quite 100 per cent just yet. But even the cautious Saudis seem willing to give the Iraqi new look a chance.

"The Iraqis are trying to establish a new identity," a senior Saudi official declared. "If they ask for support from the West, they should get it."