It is no secret that Azerbaijan, with its large offshore oil and gas deposits in the Caspian Sea, and sandwiched between Iran and Russia, is the “plum” of the region. As a geo-strategic proverb puts it, from Russia’s point of view, “Armenia is the way, Georgia is the key, and Azerbaijan is the prize.” Following the U.S. downgrading of the South Caucaus in its global strategic vision under the Obama Administration, both Russia and Iran have sought to increase their own influence in the region.
Turkey has supported Azerbaijan unstintingly since the latter’s independence. It imports natural gas from Azerbaijan and will soon be delivering more Azerbaijani gas to Europe through an east-west pipeline running the breadth of the country. Indeed the Azerbaijanis are a Turkic people, and the two languages are very highly mutually intelligible. The Turks are predominantly Sunni Muslim, and the Azerbaijanis are Shi’a, but this has not been an obstacle to their cooperation and, indeed, friendship.
In fact, until the U.S. engineered the lifting of international sanctions on Iran just recently, Iran has been very hostile to Azerbaijan even though the two countries are both Shi’a Muslim. That is because Iran has paradoxically felt an existential threat from Azerbaijan, because the latter is a country with a Shi’a population that is not a theocracy but a secular democracy.
Northwestern Iran is ethnic Azerbaijani, and Azerbaijanis have always been prominent in Persian economic and political life in the modern era. It was part of Azerbaijan proper until the 1828 Russian-Persian Treaty of Turkmenchai, which also provided for the settling of ethnic Armenians from the Persian Empire into the territory of Nagorno-Karabakh.
Russia has always been Armenia’s principal, almost only arms supplier since Armenian independence from the Soviet Union. Ever since the American geo-strategic withdrawal from the region under the Obama Adminstration, Russia has emerged also as a major arms seller to Azerbaijan. A visit by Russian president Vladimir Putin to Baku in August 2013 increased the rapprochement between the two countries.
The difference is that weapons systems to Armenia are priced as if in the domestic Russian market whereas those to Azerbaijan are available only at world market prices. Russia would like to become Azerbaijan’s dominant arms supplier, but wishes to impose that condition that such arms can never be used for the liberation of Nagorno-Karabakh from Armenian occupation.
That is a condition to which Azerbaijan would never agree, and to which public opinion would never allow it to agree. Fully 10 per cent of Azerbaijan’s population–one million people out of ten million–are refugees either from Nagorno-Karabakh or from Armenia proper, who were driven out of Armenia during the earlier inter-ethnic strife.
Russia also has a military base in Armenia, inherited from the Soviet era. In fact, its presence impedes the creation of a business environment receptive to Western investment and, according to the European Commission, contributes to blocking needed political reform.
So according to one hypothesis, the recent military outbreak is instigated by Russia in order to keep Azerbaijan in line, and to encourage it to reconsider its arms contracts with non-Russian suppliers.
According to another hypothesis, it is instigated by Russia to prevent Iranian natural gas from supplying the South Caucasus and eventually reaching Europe across the Black Sea, since Russia wishes to keep as much of the European market to itself as it can.
The second hypothesis is less plausible, since Azerbaijan supplies Georgia’s entire gas import requirements. Earlier this year, Georgia had said it was looking to diversify its sources and was considering Iranian and even Russian suppliers. However, that was likely only a negotiating ploy, as it had decided to go back to Azerbaijan a good 10 days before the new hostilities.
The idea of Iranian gas reaching Europe is still more far-fetched. Not only would it have to cross Azerbaijan, which has its own gas to provide if it wanted to do so. But also, the various projects over the last 10 years for Azerbaijani gas to go over or under the Black Sea to Europe have all proven to be logistically prohibitive or otherwise uneconomical.
Any “serious” talk of Iranian gas going to Europe concerns discussions of prospects of liquefied natural gas being exported to Spain in the early 2030s. Not only is it much too early to decide whether this is doable, but also European gas demand is unlikely to change significantly between now and then, due to emphasis on renewables and nuclear power, and decreased demand growth thanks to economic stagnation.
Although Azerbaijani public opinion continues to militate in favor of action to reclaim the occupied territory, it is not in the interest of the government elite in Baku to launch any military offensive for that purpose. It would be too destabilizing, from their point of view, to try to recapture the 20 per cent of Azerbaijani national territory that is occupied by Armenian forces.
It is inconceivable that Armenia–with its economic, military and financial dependence on Russia–would initiate the hostilities with Azerbaijan on its own. The most likely explanation, therefore, is that Russia, following its announcement of a partial withdrawal from Syria, and unable to make headway in eastern Ukraine, chose the moment to remind Azerbaijan of its vulnerability by instigating an increase in the consistent low level of attacks from the Armenian side.