World leaders from Stockholm to Sydney responded with calls for caution or condemnation of Baghdad while thousands of anti-war protesters took to the streets after U.N. weapons inspectors issued their reported on efforts to disarm Iraq.

Britain and Australia condemned Iraqi President Saddam Hussein for failing to cooperate with the inspection process and indicated that time for action was drawing close.

But other Security Council members -- most importantly Russia, China and France who hold the same veto powers as Washington and London -- said the inspections should continue for several weeks, if not months. That difference of opinion could make or break international support for military intervention in Iraq.

Top U.N. inspectors Hans Blix and Mohamed ElBaradei on Monday gave the Security Council an assessment of the first 60 days of inspections. Blix, who heads the hunt for biological and chemical weapons programs, said Iraq had not genuinely accepted the U.N. resolution demanding that it disarm. His nuclear counterpart ElBaradei said there was no evidence so far that Iraq was reviving its nuclear program.

In the Middle East, the prospect of U.S.-led war prompted a wave of protests as thousands of Arabs burned American flags and effigies of President Bush.

Yemeni security officials said tens of thousands of protesters converged on the capital, San`a.

"The Zionist American and British war is because of oil, it is oil that makes those vampires salivate," said Abdallah al-Ahmar, Yemen's Parliament speaker and head of the Islamic Reform Party.

Demonstrators also protested in front of U.N. offices in Syria, Egypt and Bahrain Monday. Lebanese demonstrators staged a sit-in outside the U.S. Embassy in Beirut, while 10,000 Sudanese protesters were stopped by police from marching on the U.S. Embassy in Khartoum.

Outside U.N. headquarters in New York, more than 300 protesters demonstrated against a possible war in Iraq, chanting "people united stop the war."

In Germany, about 3,000 people protested outside the U.S. consulate in Frankfurt, carrying banners with slogans including "No Bush-fire" and accusing the United States of going to war over oil. Hundreds more gathered in downtown Dresden and in Berlin.

British Foreign Secretary Jack Straw said Saddam was "making a charade of inspection" and was "practicing concealment."

Australian Prime Minister John Howard said Iraq was in "material breach" of U.N. resolutions.

"The government believes that Iraq does have chemical and biological weapons and that is the view of the British and American governments," Howard told Sydney radio station 2GB.

Australia is one of only three nations -- along with the United States and Britain -- to have sent troops to the Persian Gulf region to prepare for possible war with Iraq.

In Japan, Foreign Minister Yoriko Kawaguchi said Iraq has used chemical weapons in the past and must convince the world that it does not pose a threat.

"Iraq carries the burden of proof but it has not provided a proactive explanation," she said. "Iraq needs to respond more proactively."

Indonesian Foreign Ministry Spokesman Marty Natalegawa warned the United States and its allies not to use the report as grounds for an attack against Iraq.

"We feel the U.N. inspection team must be allowed to finish its work," Natalegawa said. "We hope this will be the case and there won't be any unilateral steps beyond the confines of the U.N. system."

Elsewhere, there was little appetite for military action either.

Jordanian Information Minister Mohammad Affash Adwan said the inspectors should be allowed to finish their mission in Iraq.

Turkish Prime Minister Abdullah Gul said the responsibility to avoid war lay with Iraq, but called for a new Security Council resolution before military action was taken.

"It's very important for us," said Gul, whose predominantly Muslim nation is a close U.S. ally.

The European Union is split down the middle on the issue, with Spain, Italy, Portugal and others leaning toward the pro-American camp led by Britain, while Belgium, Sweden and Finland are more closely aligned with France and Germany's anti-war stance.

French President Jacques Chirac and German Chancellor Gerhard Schroeder agreed Monday that the inspectors should be given the time they need to complete their mission, the president's office said.

Earlier Monday, Russian President Vladimir Putin emphasized the need to continue weapons inspections in Iraq during a telephone conversation with British Prime Minister Tony Blair, the Kremlin said.