Gas and oil pipelines

Strained relations with Turkey. Azerbaijan wants to consolidate its autonomy

Azerbaijani President Ilham Aliyev has set out a programme to protect the country’s territorial integrity and sovereignty. The alliance with Ankara remains in the background, but is becoming increasingly disintermediated. European interests are being put to the test by these contracts

Il presidente dell’Azerbaigian, Ilham Aliyev (Alamy Stock Photo)

4' min read

Translated by AI
Versione italiana

4' min read

Translated by AI
Versione italiana

On 2 October, the Azerbaijani President Ilham Aliyev delivered a speech at the congress of the New Party of Azerbaijan (YAP), in which he outlined, in policy terms, how the country intends to protect its territorial integrity and sovereignty, which were secured on the battlefield between 2020 and 2023. His message can be summarised in three words: peace through strength. In recent years, particularly following the Second Nagorno-Karabakh War (2020), Azerbaijan has pursued a prolific foreign policy, aimed at expanding its network of diplomatic partners, whilst always paying particular attention to its relations with Turkey.

Since the mid-19th century, the country has been well aware that its strength depends on the oil and gas fields in the Caspian region. In Azerbaijan, modern oil extraction using mechanical wells began in 1846 at Bibi-Heybat, near Baku, long before the emergence of the modern oil industry in the United States. And politicians know full well what matters: gas and the money it brings in through contracts, investments and infrastructure.

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Aliyev’s political intentions

“We are shaping our foreign policy and must continue to do so in order to prevent anyone from interfering in our affairs,” said Aliyev. “We do not need anyone’s help or protection.” He also reflected on events in Azerbaijan’s recent history: “When we needed help, nobody helped us. When we found ourselves with a million refugees, nobody lent us a hand. Everything we have received, we have bought with our own money, weapons included, right down to the very last bullet’. “Our advantage is that, unlike some countries, we do not need to create myths. In some countries, certain leaders try to take credit for past successes or exaggerate their own role by distorting history. We have no need for that,” said Aliyev.

Any personal or direct reference is very carefully omitted, but it is by no means lost on anyone that the addressee of these words is the Turkish President Recep Tayyip Erdoğan. From a political perspective – and not only that – Aliyev’s words appear to downplay any role played by Turkey or other external actors in Azerbaijan’s military success during the Second Karabakh War. And this may seem all the more unusual when one considers the outcome of the 2021 Shusha Declaration.

This is a strategic agreement and alliance signed by the two countries: both undertake to provide mutual aid and military assistance in the event of a threat or aggression against their independence and sovereignty by third parties; it provides for the strengthening of the joint defence industry, the modernisation of the armed forces and the coordinated production of military equipment, including drones; it emphasises the importance of opening the Zangezur Corridor to link Azerbaijan to Turkey via the Nakhchivan exclave; it promotes the development of the Southern Gas Corridor; it encourages cooperation in sectors such as education, culture and sport, to cement the idea of ‘two states, one nation’.

Undoubtedly, the words of Aliyev are a source of great pride for the Azerbaijani people. It would be far more pragmatic to assess just how much room Baku can realistically retain within this relationship, not least because, whilst the alliance may well remain strong politically, on the economic front it is investment and infrastructure that determine how much it would cost each of the two countries to change course.

Azerbaijani export figures

In the first six months of 2026, Azerbaijan exported 12.7 billion cubic metres of gas: 5.9 billion to Europe and 4.9 billion to Turkey, which together accounted for around 85 per cent of the total. Baku’s aim now is reportedly to broaden its political partners, but it is not that simple. Not least because of the very structure of the pipeline network itself.

Just to give an overview of the companies involved, the Trans-Anatolian Pipeline (TANAP) – an infrastructure that runs entirely through Georgia and Turkey to transport Azerbaijani gas from the Caspian Sea to Europe – involves, alongside Azerbaijani interests, those of BOTAŞ – Turkey’s main state-owned company for the transport, storage and trading of crude oil and natural gas, owned by the Turkey Investment Fund – and the British company BP. In the next section of the same pipeline, the Trans-Adriatic Pipeline which runs from the Turkish-Greek border to the coast of Puglia, the participants are BP, SOCAR, SNAM, Fluxys and Enagás, each with a 20 per cent stake. Socar Türkiye, Socar’s main overseas subsidiary, reported cumulative investments in the country totalling approximately 19.5 billion dollars in June 2026.

LA MAPPA DEI GASDOTTI

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European interests

To all this must be added the European interests, which, of course, are not necessarily shared by all. This is demonstrated by the fact that the major economies of the Old Continent are involved on different fronts. In the first six months of 2026, Azerbaijani exports to Italia totalled 5,503.6 million dollars, compared with 256.6 million dollars’ worth of imports from Italia. Rome accounts for approximately 68.4 per cent of Azerbaijani exports to the European Union.

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As regards gas, ARERA data show that in 2025, Azerbaijan accounted for 16.2 per cent of Italy’s gross imports, totalling 61.6 billion cubic metres. In the same year, imports of liquefied natural gas rose from 14.7 to 21.2 billion cubic metres. This energy exposure is compounded by industrial exposure. In October 2025, Saipem announced three contracts for Shah Deniz Compression, with a total value for the consortium of approximately 700 million dollars, of which Saipem’s share is 600 million. The works include offshore activities and approximately 26 kilometres of pipelines, with completion scheduled for 2029. As recently as last May, Prime Minister Giorgia Meloni spoke of ‘permanent political coordination and industrial cooperation’.

France, whilst having strong industrial interests in Azerbaijan, has nevertheless strengthened its relationship with Armenia. And as is perhaps well known, there is no shortage of rivalry between Azeris and Armenians. On 26 September, TotalEnergies announced the final investment decision for the full development of Absheron: the company holds a 35 per cent stake and is the operator alongside Socar and Xrg. The project, scheduled to come on stream in 2029, is expected to increase capacity from 1.5 to 6 billion cubic metres per year.

On the Armenian side, the agreements include a letter of intent on AI, cybersecurity and semiconductors, funding and aeronautical supplies. France has also strengthened defence cooperation with Yerevan, whilst supporting normalisation with Baku and regional ties, with due regard for sovereignty and territorial integrity.

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