For centuries, Turkmenistan's trade routes had run westward across northern Iran, home to at least 1 million ethnic Turkmen. Now tractor-trailers carrying goods from the Persian Gulf crossed into Turkmenistan from Iran and barreled north to old Silk Road cities such as Bukhara and Samarkand, in Uzbekistan, and Almaty, in Kazakhstan. Trains hauling Japanese and South Korean cars entered Turkmenistan from Iran at a new railroad crossing at the town of Sarakhs.

The sudden prospect of a substantial share of the world's natural gas flowing through Iran galvanized the Clinton administration last fall into taking a harder look at its Caspian policy. Administration support for U.S. oil companies in the Caspian had been fitful at best since 1993. Many oil executives were unhappy with the Clinton team, complaining of turf battles, heavy turnover of key officials and lack of coordination.

In Azerbaijan the main consortium of Western oil companies could detect few clear signals from Washington as it pondered a decision about the route of the principal pipeline to carry 1 million barrels a day of Azeri oil to world markets.

The shortest and cheapest path led to a tanker port on Georgia's Black Sea coast, but the added oil cargoes would jeopardize the narrow, environmentally fragile Bosphorus Strait en route to the Mediterranean. Instead, Turkey favored a big pipeline from Baku to Ceyhan, a well-outfitted Turkish oil port in the eastern Mediterranean.

That debate, along with Niyazov's overtures to Iran, forced an inter agency group in Washington to pull together a comprehensive Caspian policy reflecting U.S. interests.

The result, unveiled last November by Federico Peña, then energy secretary, was a proposed Eurasian Transportation Corridor made up of gas and oil lines skirting both Russia and Iran. The plan envisioned a skein of east-west pipelines starting on the east side of the Caspian and passing under the sea before continuing to Turkey and the Mediterranean.

The trans-Caspian oil connection fit the needs of a number of U.S. oil giants. To Chevron Corp., Mobil Corp. and Texaco Inc., which had major oil concessions east of the Caspian, it offered an alternative to Russia. Amoco Corp., Exxon Corp., Pennzoil Co. and Unocal also wanted more crude coming from east of the Caspian to help defray costs of the big pipeline planned to transport Azeri oil.

A parallel trans-Caspian corridor for gas had a more openly geopolitical purpose. It would, according to oil analysts, reassure pro-Israeli factions and anti-Iranian hard-liners in the United States of the administration's commitment to isolate the Tehran regime. When Niyazov made his first official visit to Washington last spring, President Clinton touted the trans-Caspian gas line as an alternative to the Shell pipeline across Iran.

Hardly had the administration unveiled its policy, however, than hints of a U.S. thaw toward Iran muddied the issue once again. In May, the White House announced it would not sanction French, Russian and Malaysian companies for developing Iran's largest offshore gas field. A month later, Secretary of State Madeleine K. Albright called for the United States and Iran to develop "a road map leading to normal relations."

The possibility of U.S.-Iranian detente undercut the argument against a gas line across northern Iran and divided the big U.S. oil companies.

Mobil, which wanted U.S permission to deliver small amounts of oil to Iran from its concession in western Turkmenistan, urged the Clinton administration to seize "a unique opportunity to engage" Tehran. But Amoco, representing the consortium developing Azeri fields, warned State Department officials in July that an Iranian pipeline could divert the volumes needed to justify building the Azerbaijan-Turkey route.

That high-level meeting reflected Niyazov's success in drawing the U.S. government into a search for solutions to his energy problems. Even so, it was becoming evident that the administration's ability to convert its pipeline vision into a reality was circumscribed by budgetary, ethnic and foreign policy factors.

For example, the U.S. government could provide only limited assistance to pipeline construction across the Caspian, administration officials said, because Congress would not subsidize U.S. oil and gas companies. Barring subsidized loans, the administration was limited to offering modest loan guarantees and political risk insurance.

Greek American and Armenian American lobbies also denounced legislation that supported the administration's east-west pipeline corridor. The ethnic lobbies contended the corridor would strengthen Turkey and Azerbaijan, enemies of their ancestral homelands. The legislation languishes.

But those obstacles proved minor compared to the greatest risk posed by the U.S. pipeline proposal: the prospect of a conflict with Moscow.

Morgan reported from Turkmenistan, Scotland and Texas; Ottaway reported from Moscow, Washington and Texas.