At last, we are seeing some progress towards a UN resolution on Iraq

There have been many times during the pre-war and post-war Iraq diplomacy when it has been hard to judge what is reality and what is political shadow-play. But rarely has it been more difficult than in the past few days.

There have been many times during the pre-war and post-war Iraq diplomacy when it has been hard to judge what is reality and what is political shadow-play. But rarely has it been more difficult than in the past few days.

First, the United States and Britain tabled the draft of their latest Security Council resolution, providing for the transfer of sovereignty to an interim Iraqi government. Next, President Bush gave a long-awaited speech setting out his priorities for the transfer, which made it sound as though almost nothing had changed since Saddam Hussein was toppled. Then the Prime Minister called for Iraq to have "full sovereignty", prompting a rash of headlines about rifts and splits between London and Washington. Finally came the denials. "We are absolutely agreed," Tony Blair told the Commons yesterday, "that there should be full sovereignty transferred to the Iraqi people, and the multinational force should remain under American command."

So everything is as clear as mud, or as clear as the ambiguity of international diplomacy allows when the bargaining is still in progress and the endgame approaches. For perhaps the only clear message that can be extrapolated from this tangle is that, five weeks before the 30 June deadline for the handover, the terms on which Iraq regains its sovereignty have not yet been finalised.

And while the US and British positions might seem contradictory, there is evidently sufficient agreement and sufficient leeway for the US and Britain and the United Nations, President Chirac, Chancellor Schröder, President Putin and other international leaders to be on speaking terms again. Phone lines across the Atlantic have been buzzing almost as frequently as they did during the fraught negotiations on the ill-fated second resolution last year. The UN is again a hive of diplomatic activity. And this is a positive development. Another positive development is the floating of names of a possible interim president and prime minister - one a Sunni, one a moderate Shia - who both appear well qualified.

For Mr Blair, the headlines about a stand-off between London and Washington do no harm at all, whether or not they are true. For weeks, he has resisted pressure - from his own backbenchers and, more recently, from the Opposition - to distance himself from President Bush. Real or not, there is now a transatlantic "rift" on the noblest and most urgent of issues, the extent of Iraq's post-handover sovereignty, and Mr Blair is on the same side as most British, European and, probably, Arab opinion. After months as Mr Bush's junior partner, he can be cast once again in the role of honest broker between the Americans and the rest. No wonder he looked more cheerful in the Commons yesterday than for many a week. This is a diplomatic coup of a sort, if he can carry it off.

But Mr Blair's formulation of the extent of the agreement between London and Washington still leaves many unanswered questions. And it is on the answers that the sincerity of the transfer of sovereignty - and its success or failure - will depend. Mr Blair is right when he insists that Iraq must have "full" sovereignty, and this must include the right to determine whether the occupation forces stay or leave, and when. Both US and British officials have hinted, in the recent past, that an interim Iraqi government should have that power, while expressing confidence that the troops would be asked to remain, at least until after the planned elections. It is hard to see how giving the Iraqis this choice would hurt Mr Bush, still less Mr Blair, politically.

It is unrealistic to expect Mr Bush to cede command of US forces to the UN in the middle of the US election campaign. But it is not unrealistic to hope that an Iraqi government would have the deciding say in where troops were deployed and for what purpose. If this is a condition for other countries to leave their troops in Iraq, or contribute to a new and genuinely multinational force, that is a price that Washington should be prepared to pay.