MOSCOW, MARCH 8 -- The allied victory over Iraq has allowed the Kremlin to distance itself from Saddam Hussein, secure in the knowledge that the Iraqi leader has nowhere else to turn if he wants to rebuild his shattered country.

Once regarded as the Soviet Union's principal political ally in the Middle East, Saddam now is widely viewed here as a discredited dictator who led his country to disaster. In the days since the end of the Persian Gulf War, Soviet policy-makers have made it clear that they will not lift a finger to keep their former client in power.

"Who leads Iraq is the business of the Iraqi people. If Saddam remains in power, we will deal with him. But if someone else comes to power, we will also accept that," Sergei Grigoriev, a spokesman for President Mikhail Gorbachev, said in an interview.

Relations between Moscow and Baghdad deteriorated sharply as a result of the Iraqi invasion of Kuwait last August, which was condemned by the Soviet Union. Until a few days ago, however, the Iraqi leader still was able to count on the vocal support of hard-liners in the Soviet Communist Party and armed forces who are instinctively hostile toward the West.

The crushing defeat of Saddam's armies by the U.S.-led coalition and the subsequent anti-Saddam revolt in Iraq have taken the wind out of the conservative sails. They have demonstrated the unpopularity of the Iraqi leader in his own country and underlined the futility of backing a loser.

During the past week, the Iraqi president's sympathizers have fallen silent, reluctant to acknowledge the scale of the allied victory. Liberal commentators and politicians, meanwhile, have stepped up their attacks on the Baghdad regime.

"Yes, it was necessary to do everything to avoid a war. And everything was done. For almost six months, they tried to persuade, plead with S. Hussein. His reply was to mock those who tried to plead with him," wrote influential foreign policy analyst Alexander Bovin in the government newspaper Izvestia. "If we don't stop S. Hussein today, then new Husseins will appear tomorrow and even more blood will be spilled. The war conducted by the United States and the multinational coalition was therefore our war as well."

By supporting the anti-Saddam coalition in the United Nations, while launching his own eleventh-hour peace initiative, Gorbachev effectively straddled the diplomatic fence in the gulf war. In the final analysis, he was unwilling to put improved superpower relations at risk for the sake of a long-standing Third World client. But he also sought to preserve Moscow's diplomatic clout in the Middle East by keeping its lines of communication open with Baghdad. "I think that the Iraqis understand that the Soviet Union was the only country willing to talk to them. They also understand that now, when the whole world is against them, the only place they can conceivably turn for help is the Soviet Union," said Grigoriev.

Until last August, the Soviet Union was Iraq's principal foreign arms supplier and a major source of technological assistance. The overwhelming majority of the tanks and planes destroyed by the allies were manufactured in the Soviet Union.

A 1972 treaty of friendship and economic cooperation between the two countries has never been revoked. Officially, the Kremlin says it is in favor of a "disarmed and democratic" Iraq. At the same time, official spokesmen implicitly have linked Soviet willingness to continue an international arms embargo against Iraq with a general reduction in arms deliveries to the Middle East. "This can't be done unilaterally. If other countries accumulate weapons, then Iraq is not going to feel secure," said Grigoriev.

"I can't see any resumption in Soviet arms supplies to Iraq in the near future," said Vitaly Naumkin, a senior policy analyst with the Institute for the Study of the Middle East in Moscow. "At the same time the Soviet Union does not want to allow the disintegration of Iraq as a state, a development that would destabilize the entire situation in the region. Support for Iraq's sovereignty and territorial integrity is not the same thing as support for Saddam Hussein."

The question of Soviet arms supplies to Baghdad likely will be an important topic when Secretary of State James A. Baker III visits Moscow next week at the end of his current Middle East swing. And Soviet leaders will be looking for assurances that Washington does not intend to maintain a permanent military presence close to the Soviet Union's southern borders.

Official Soviet statements welcoming "the liberation of Kuwait" by the U.S.-led coalition have been mixed with warnings of American "arrogance." An article in the official Communist Party newspaper Pravda on Thursday cautioned that America's "Vietnam syndrome" could be giving way to an "Iraqi syndrome," a belief in U.S. military invincibility.