The Allies: A Problem of Pipe

To pump its burgeoning oil and gas production from new fields in the Caucasus and Urals, Russia has undertaken a 38,000-mile pipeline network, with two main legs: one westward from Kuibyshev near the Urals to power the factories of Russia's European satellites, the other thousands of miles through Siberia and on to the Pacific. Trouble is, Russia cannot produce all of the big-bore (up to 40 in.) pipe itself; so it has turned to capitalist manufacturers, mostly in West Germany and Italy, for 40% of the 2,500,000 tons of pipe it needs for the project.

Arguing that the pipelines are of vital strategic use to Russia, NATO's trade advisory committee last week tried to put an end to the pipe trade. Weeks ago, Italy, which had sent Russia 180,000 tons of pipe, went along with NATO's new ban, canceled a 60,000-ton shipment. Japan canceled negotiations for 20,000 tons.

But a howl went up in West Germany, Russia's No. 1 oil-pipe supplier (633,000 tons from 1959 through last October). Just three and a half months ago, three giant Ruhr firms—Mannesmann, Phoenix-Rheinrohr AG, and Hoesch—signed a contract for another 200,000 tons. Ruhr steelmen denounced Chancellor Konrad Adenauer as a NATO stooge for trying to enforce the new rules. Taken aback, Adenauer's Cabinet last week agreed to reconsider, turned the problem over to a special subcommittee for special study.