Secretary-General Javier Perez de Cuellar says he expects a truce in the Iran-Iraq war in two weeks, now that Iran has agreed to Iraq's compromise proposal that direct peace talks quickly follow a cease-fire.

The announcement of the cease-fire date was expected to be made after an afternoon session of the 15-nation Security Council and may include the date of the start of direct talks between Iran and Iraq and where they will be held, U.N. officials said.

Perez de Cuellar had said earlier it would take at least two weeks for the cease-fire to take effect because of the need for "preparations" such as mobilizing a U.N. truce team.

"I tell you that in principle I will announce a cease-fire tomorrow (Monday)," Perez de Cuellar said Sunday evening. "I have informed the Security Council that the two sides agree with the cease-fire followed by direct talks under my auspices."

On Tuesday, the Security Council is expected to vote on a resolution setting up a U.N. observer force to be positioned between Iraqi and Iranian troops and specifying the number of observers required and the method of financing it.

U.N. officials from a technical team previously dispatched to the warring nations' capitals to study ways to enforce a cease-fire have said that a truce team would require at least 250 officers.

The announcement culminated negotiations that began at the United Nations July 26, eight days after Iran said it would agree to start discussing a cease-fire in the war that has left more than 1 million people on both sides dead or wounded.

Perez de Cuellar said the final agreement was reached during separate meetings he held earlier Sunday with Iran's foreign minister, Ali Akbar Velayati, and Iraq's U.N. ambassador, Ismat Kittani.

U.S. Ambassador to the U.N. Vernon Walters welcomed the announcement, saying, "This is the beginning not the end. The United States will do anything to help the peace process move forward."

In Kuwait, Defense Minister Sheikh Nawaf al Ahmad al Sabah said he believed foreign warships in the Persian Gulf would leave the strategic waters if the war ended.

The United States sent its warships to the gulf last year to protect neutral shipping, but has since engaged in combat with the Iranian navy and downed an Iranian civilian airliner, killing all 290 passengers and crew aboard.

In a related development, Lebanon's Al Diyar newspaper, quoting an unnamed Syrian official, said the fate of 16 foreign hostages believed held outside Beirut, including nine Americans, may depend on the outcome of the Iran-Iraq war.