It will be denied, as they say, and with good reason. But there is more than a whisper of expectation in the upper reaches of the Carter administration that the so-called European initiative in the Middle East may not turn out to be the potential monkey wrench in the Camp David machinery that it has been made out to be. In fact, that initiative might even have useful and positive effects (not necessarily on purpose).

At first blush, the compromise reached by the nine European Common Market members at Venice last week has the look of a feckless ego trip. You have to wonder what there is in that won't bring the Europeans, when they've finished all their diplomatic soundings, face to face with precisely the same forces at work that now confront the famous Camp David framework.

Already, the Palestine Liberation Organization is screaming that the European didn't go nearly far enough. Predictably, the Israelis are shouting that the Europeans went much too far.

From the Carter administration, the Europeans' final document provoked an almost explosive sigh of relief that fell somewhere short of a warm embrace.

That's understandable. The Carter administration feels itself tightly bound to a five-year-old commitment to Israel by Henry Kissinger that the United States will not accept the PLO as a bargaining partner until after the PLO subscribes to the guiding principles of U.N. Security Council Resolution 242 and recognizes Israel's right to exist. The administration could hardly associate itself closely with a European initiative that has as its centerpiece an effort to strike up relations with the PLO.

Still less could President Carter tolerate anything that might threaten to supplant his cherished Camp David handiwork with a peace process not of his making.

Hence the president's original threat to use the U.S. veto in the U.N. Security Council if the Europeans sponsored a resolution to rewrite 242, as they first indicated they might do. Hence also the sharp warning in Secretary of State Muskie's recent Mideast speech against any changes in 242 or the Camp David formula: "The United States will not allow that to happen."

But a better test of the administration's true feelings about the European initiative, according to responsible authorities, is the next line in the Muskie text: "We do not object to new initiatives that would further the Camp David process." That sentence, I'm told, was inserted by the president himself.

That is the sort of thing you would say about something you can't exactly control, but it also reflects a consensus at the highest levels: precisely because the Europeans are not operating within the Camp David process, and could conceivably become an alternative to it, they might actually have the effect of reinforcing or even accelerating it.

How? To begin with, almost nobody in the administration's policy-making circles seriously believes that the current Camp David phase -- the so-called autonomy talks on the degree of self-governance to be granted to the inhabitants of the West Bank and Gaza -- can reach a workable solution without the PLO's participation in some form at some point.

Secretary Muskie says publicly that "we are not trying to keep out" the PLO, but simply trying to enforce compliance with the Kissinger commitment.

The PLO's answer is that it won't even consider meeting the American terms until after it has been recognized by the United States and Israel as the "sole legitimate representative" of the Palestinians. Note the Catch 22: who goes first?

Logically, the answer would seem to be some sort of prearranged, simultaneous exchange of mutual recognition by Israel and the PLO of each other's rights and interests. But how to do the arranging if you're not talking to each other? Enter the Europeans, on speaking terms with the PLO, formally allied with the United States (which is Israel's main source of support) and sharing to some extent the same objectives while working independently. You just might have the working of a diplomatic process for breaking this critical impasse.

And if not -- if the PLO won't budge and the administration can't bring itself to apply the necessary pressures on Israel in an election year, and the autonomy talks drag on -- the Europeans provide (or so they argue) a safety net, a way to buy time in a situation threatening to become more and more incendiary.

Perhaps most important, such is the European readiness to yield to Arab terms in the interest of stability (which is to say, oil) in the region that the Israelis may well see the European "safety net" as a powerful new incentive to make the Camp David process work.

In his handling of the Mideast issue at next week's summit of the Big Seven industrial nations in Venice, President Carter would be wise to make generous allowance for all of these possibilities.