UNITED NATIONS, JAN. 15 (TUESDAY) -- The U.N. Security Council ended two hours of informal, closed-door discussions this morning on a last-minute bid by France to end the Persian Gulf crisis peacefully, but the plan appeared likely to fail when the U.N. Security Council resumes talks today.

The surprise proposal to have the Security Council agree to Iraqi President Saddam Hussein's demand for an international conference on the Palestinian question faces strong opposition from the United States and other council members.

The French circulated their proposal Monday, the eve of the U.N. Security Council deadline for Iraq to withdraw from Kuwait, after U.N. Secretary General Javier Perez de Cuellar said his talks with Saddam left him without "any reason to have real hope" of averting war.

Following discussions among Security Council representatives, Perez de Cuellar told reporters early this morning that "the members of the council are unanimous in desiring a peaceful solution and are prepared to continue their efforts" today. France's U.N. ambassador, Jean-Louis Blanc, said discussions would resume this morning.

Diplomatic sources said talks on France's draft declaration, which would require unanimous approval of the 15-member council for passage, stalled when the United States, Britain and the Soviet Union requested a recess to consult their leadership on the matter.

In the Middle East, Iraq continued to defy U.N. calls for an unconditional withdrawal Monday as its National Assembly unanimously gave Saddam a free hand in dealing with the crisis and called for a "holy war" against U.S.-led troops to defend Iraq's 5 1/2-month occupation of Kuwait.

In Washington, President Bush, who won approval from Congress over the weekend to use force against Iraq, maintained a public silence Monday but told congressional leaders he will formally decide whether to launch a military strike after the U.N. deadline passes. White House Press Secretary Marlin Fitzwater said, however, that after midnight tonight, "everyone has to assume that military action could occur at any point."

France proposed that the Security Council agree to Saddam's demand for an international conference on the Israeli-Palestinian conflict if Iraq leaves Kuwait. Saddam, who held talks Monday with Palestine Liberation Organization Chairman Yasser Arafat, has insisted that any peaceful end to the gulf crisis be linked with a resolution to Israel's occupation of the West Bank and Gaza.

The French plan drew an angry response from the United States, which said it was contrary to U.S. insistence that there be no linkage between Iraqi withdrawal and an international Mideast conference. American officials also said Saddam should not be rewarded for his aggression in the gulf.

Asked if the French proposal was acceptable to the United States, Thomas R. Pickering, the U.S. ambassador to the United Nations, said: "No. We made it very clear that we don't believe the creation of the linkage that appears to be in the French text . . . is a real contribution at the present time. . . . I think what they have intended to do is to somehow take an intransigent Saddam Hussein and offer him more and more."

Among other nations opposed to the plan were Britain and the Soviet Union, whose U.N. ambassador, Yuli Vorontsov, called it "a good proposal at the wrong time. Saddam Hussein has got to give something."

The plan was contained in a proposed declaration that France wants the Security Council president to issue. The French presented the idea at a council meeting late Monday night at which Perez de Cuellar's report on his fruitless talks with Saddam on Sunday. After the meeting, Perez de Cuellar said his report would be kept confidential for the time being.

One diplomat who was present while Perez de Cuellar made his report said the secretary general told the council that he had asked Saddam if he was prepared to leave Kuwait, and Saddam had replied, "No." According to the diplomat, Perez de Cuellar then felt there was no point in attempting to broach any of the various schemes that he reportedly been carrying on behalf of European and Arab governments.

Diplomatic sources here said French President Francois Mitterrand hopes that his proposal will lead Saddam to invite French Foreign Minister Roland Dumas to Baghdad for further discussions. That, the sources said, would effectively stretch the U.N. deadline beyond today and stave off for at least a few more days the likelihood of war.

Earlier Monday, however, when asked about speculation that the deadline might be extended, Pickering said: "I don't believe there will be any extension."

While Baghdad sent out a string of hard-line messages Monday, Iraq's official Arabic and English-language newspapers gave unusually prominent treatment to a weekend message broadcast by Syrian President Hafez Assad urging Saddam to "defuse" the gulf crisis by withdrawing from Kuwait. Saddam's published reply urged Syria, a member of the anti-Iraq coalition, to join Iraq in its "confrontation against the forces of evil threatening the Arab world," but it did not reject outright Assad's appeal for withdrawal.

Saddam himself, however, seemed to squelch prospects of any eleventh-hour peace bids when he said in an interview with Iraqi journalists in Baghdad that "if {the Americans} want war, no other power can stop it. A last-minute initiative is up to the Americans because they are the ones raising the slogan of war."

The French initiative came hours after European Community leaders meeting in Paris decided against sending an emissary to Baghdad on the advice of Perez de Cuellar, who told them it would be pointless based on the intransigent views he heard during his 2 1/2 hours of talks with Saddam. "Unfortunately, I don't see any more reasons to be optimistic. I don't see any reason to have real hope," the U.N. chief said in Paris.

The German parliament, meeting Monday in special session, warned Iraq to withdraw from Kuwait immediately or face war. The warning came shortly after legislators rejected a proposal by the opposition Social Democrats to denounce any use of force in the gulf and to criticize Chancellor Helmut Kohl's decision to send 18 fighter jets to defend Turkey's border with Iraq.

Turkey, for its part, asked the United States Monday to send 48 more combat aircraft to help in defense against Iraq, Prime Minister Yildirim Akbulut told Turkish television. Turkey, the only NATO country that shares a border with Iraq, has already accepted 48 planes.

The French and Italian parliaments were scheduled to meet Wednesday to debate whether to approve the use of force against Iraq by the international coalition. Secretary of State James A. Baker III, on a trip overseas which ended Monday, won approval from a number of U.S. allies in the anti-Iraq coalition, including Saudi Arabia and Egypt, to move against Saddam militarily.

The sudden French initiative appeared to break what several sources called an understanding among the Security Council's five permanent members -- France, the United States, Britain, China and the Soviet Union -- that none would offer any resolutions until after the deadline for Iraqi withdrawal had passed.

The United States, in particular, is understood to feel that such a move would play into Iraq's strategy of stalling and trying to divide the military coalition arrayed against it.

U.S. officials here said they were advised over the weekend that Mitterrand and Dumas wanted to make a new initiative. But, the officials said, they did not know the details of the plan until the French put it forward late this afternoon.

France, which had taken the lead throughout the crisis in trying to use a Mideast conference as a bargaining chip with Iraq, sought to address U.S. objections in the language of its proposed declaration. The draft language calls for Iraq first to begin a withdrawal under U.N. supervision. By saying that must be done first, the French could argue that their plan represents not linkage but a sequential course of action.

In an attempt to overcome U.S. objections, the French worded their declaration to conform closely to past U.S. statements endorsing the concept of an international conference, but leaving its timing indefinite. It said that if Iraq withdraws, the 15 members of the Security Council would "make an active effort to resolve the other problems of the region and, in particular, the Arab-Israeli conflict and the Palestinian problem through the convening, at an appropriate time, of a properly structured international conference."

The phrases "at an appropriate time" and "properly structured" come directly from U.S. policy statements describing the circumstances under which Washington would support a conference. Bush and Baker have stated several times that they oppose such a conference now because it would be seen as linkage and a capitulation to Iraqi demands.

Israel vehemently opposes such a conference as a breach of its sovereignty and a bid by France and other European nations to gain influence in the Arab world at Israeli expense.

In other developments Monday:

Yemen's President Ali Abdallah Salih, whose country has ties with Iraq, announced a peace proposal calling for an international conference, and Algeria's President Chadli Bendjedid reportedly was still prepared to serve as a peace emissary.Saddam warned Saudi Arabia's King Fahd, who invited foreign troops into his country to defend it against Iraq, that hundreds of thousands of Saudis would die in a gulf war. "Who gave you the authority to push the world to a war?" Saddam asked in a message to Fahd broadcast by Baghdad radio.Thousands of people in Europe, Africa, Asia and the United States demonstrated against a gulf war. Post correspondents William Drozdiak in Paris, Marc Fischer in Bonn and Tod Robberson in Baghdad contributed to this report.