LONDON, Dec 31: British spy chiefs secretly warned that the United States would be prepared to invade Saudi Arabia and Kuwait to seize their oilfields following the 1973 Arab-Israeli war, it was disclosed on Thursday.

Files released to the British National Archives under the 30-year rule for classified documents show the intelligence agencies believed the US was ready to take military action to prevent further disruption to oil supplies.

It followed the decision in Oct 1973 by Arab nations to slash oil production, and send prices rocketing, while imposing a complete embargo on the Americans over their support for Israel.

In Britain, Prime Minister Edward Heath's Conservative government, which adopted a more pro-Arab line, was forced to draw up plans for gasoline rationing after panic buying led to shortages at filling stations.

Although the war in the Middle East was over after three weeks, a secret assessment drawn up for government ministers by the Joint Intelligence Committee (JIC) - including the heads of MI5 and MI6 - concluded the US would rather risk military action than be held to ransom again by the Arabs.

The report, dated Dec 12, 1973, and marked "UK Eyes Alpha", described the seizure of the oil-producing areas in the region as "the possibility uppermost in American thinking".

The JIC calculated the US could guarantee sufficient oil supplies for themselves and their allies by taking the oilfields in Saudi Arabia, Kuwait and Abu Dhabi, with total reserves of more than 28 billion tons.

It warned the American occupation would need to last 10 years, as the West developed alternative energy sources, and would result in the "total alienation" of the Arabs and much of the rest of the Third World, as well as "domestic dissension" in the United States.

However, it said the Republican administration of President Richard Nixon could be prepared to take the risks, if it was faced with the "dark scenario" of renewed Arab-Israeli conflict and further protracted oil restrictions.

It said that the United States would even consider pre-emptive action if Arab governments, "elated by the success of the oil weapon", began imposing new demands.

"Even if this had not happened, the US government might consider that it could not tolerate a situation in which the US and its allies were in effect at the mercy of a small group of unreasonable countries," it said.

"In view of the incalculable consequences of military action against the Arabs, we consider that US intervention would probably come late as a move of last resort," it said. "But we cannot rule out the possibility of a rather earlier intervention," it added. -AFP