GENEVA, Feb. 11 - Trade ministers and ambassadors granted Iraq observer status at the World Trade Organization on Wednesday and, in a trade-off to avert a new dispute, gave Iran a glimmer of hope that its membership would be considered in May.

Earlier, trade diplomats feared that countries resenting the United States-led occupation of Iraq, many of them developing nations, might block Iraq's request for observer status - the first step to becoming a member - as long as Washington and Israel continued to bar Iran's longstanding bid for accession.

That standoff did not take place.

Iraq's request for observer status was accepted at Wednesday's meeting of the General Council, the W.T.O.'s main decision-making body, and Iran - whose membership bid is backed by the European Union and many developing countries - won more vocal support than ever before. Some of the nations hoped that at the next meeting of the W.T.O. in May Iran would be allowed to begin talks to join the trade group.

"It's our hope that there is now overwhelming support to Iran's accession," Mohammad Reza Alborzi, Iran's ambassador to the United Nations in Geneva, said after the meeting, adding that he expected a decision at the next General Council gathering May 17 and 18.

For Iran to enter the W.T.O., other member nations would have to approve - or at least not oppose - its admittance.

"We must wait and see, but I'm cautiously optimistic," the ambassador said.

Washington's envoy to the talks, Peter Allgeier, the deputy United States trade representative, said that Iraq's confirmed observer status and efforts to become a member of the W.T.O. were vital to helping rebuild the Iraqi economy after decades of isolation.

But Mr. Allgeier declined to comment on whether Washington would indeed drop its opposition to Iran's joining the organization, telling journalists the matter was still "under review.''

The position effectively blocked consideration of Iran's bid for entry. Israel's ambassador to the United Nations in Geneva, Yaakov Levy, declined to comment.

Iran first tried to join the W.T.O. in 1996, a year after the trade body was founded. Over the last three years, Washington has blocked Iran's membership, accusing Tehran of supporting Hezbollah militants and building nuclear weapons.

Some countries in turn accused Washington and Israel of hypocrisy, arguing that it was unreasonable to bar Iran while welcoming Iraq and insisting that W.T.O. membership should not be decided on political grounds, but on business and trade issues.

Trade diplomats and ministers meeting at the W.T.O. headquarters in Geneva on Wednesday also appointed leading negotiators to resume stalled global trade talks that ground to an acrimonious halt last September.

Still, the trade diplomats said that it was unlikely that the talks would be concluded by the Jan. 1, 2005, deadline, given five months of inactivity and approaching elections in the United States in November.

In a parallel effort to revive the talks, Robert B. Zoellick, the United States trade representative, has been on a two-week tour of major cities in Asia, Africa and Europe.

In January, Mr. Zoellick sent a letter to other W.T.O. member states urging them to put the failure in the Mexican city of Cancún behind them and come together "to focus on the basics, especially the core market- access topics of agriculture, goods and services."

At issue are the large subsidies paid to farmers in rich developed countries like the European Union and the United States, which poorer, less-developed countries say distort free market forces that would otherwise make their products highly competitive on world markets.

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