Al Fayed, the owner of Harrods department store, contends that his son, Dodi, and the princess were victims of a plot directed by Prince Philip, the husband of Queen Elizabeth II, and carried out by rogue British agents.
"Attempting to engineer a crash, that is utterly possible, isn't it?" al Fayed's lawyer Michael Mansfield asked Anthony Read, a senior accident investigator for London's Metropolitan Police.
"I would have to admit that the attempt to engineer a crash is, of course, possible," Read said. "The success of any attempt, of course, is an entirely a different matter."
Mansfield drew on the testimony of Olivier Partouche, who said he saw a dark Mercedes car pursued by motorcycles entering the tunnel, close behind another car; and that of Benoit Boura and Gaelle L'Hostis, who were traveling through the tunnel in the opposite direction and said they saw a car in front of the Mercedes.
Mansfield suggested that if Henri Paul, driver of the couple's Mercedes, found the road blocked by a car in front and a slow-moving car in the right hand lane, he would have no way of getting past.
He also testified that Paul, who was estimated to be going over 60 mph (96 kph), appeared to lose control of the Mercedes after clipping the left rear corner of a slower-moving Fiat Uno.
"It was the presence of the Fiat that required Henri Paul to steer left," Read said.
Analyzing tire tracks in the tunnel, Read said the Mercedes veered to the left, striking a curb in the center of the tunnel; Paul reacted by steering to the right, then steered left to avoid striking the tunnel wall.
As a result, Read said, the Mercedes smashed into a concrete pillar, fatally injuring Diana, Fayed and Paul.
Ian Croxford, an attorney for Paul's family, suggested the Mercedes may have been nudged to one side by the Fiat - which Read said was a possibility.
Read confirmed that British police had relied on French investigators for the conclusion that the Fiat collided with the Mercedes. The right front fender and door of the Mercedes, which reportedly had traces of paint from the Fiat, were not available to British investigators, he said.
Read said a number of factors probably contributed to the crash.
"In common with almost all road traffic collisions, there is no one single cause," he said. Possible factors include speed, impairment by alcohol or drugs, the distraction caused by pursuing paparazzi, the need to avoid an obstacle, and the swerve and dip of the road into the tunnel.
Police determined the Fiat was a white Uno model built between 1983 and 1989. It has never been traced.
Testifying on Wednesday, Read said it was "surprisingly difficult" to stage a collision, even under the controlled conditions set up by accident investigators.
He said it appeared that Diana and Fayed, riding in the back seat, were not wearing seatbelts. If they had been, he said, it is likely they would have survived.
Following the refusal of French paparazzi photographers to testify at the inquest, the acting coroner, Lord Justice Scott Baker, ruled on Wednesday that he was prepared to let the jury hear previous statements the photographers had made to French authorities.
"One of the purposes of these inquests is to confirm or allay public suspicions," Baker said.
"Some of the assertions that have been ventilated in the media have already faded into the sunset, if not disappeared over the horizon. But it seems to me that, where possible, the jury should hear relevant evidence on all issues that remain live, even where the witness is unwilling to give it orally."