ENERGY POLICIES IN THE SOUTHERN CAUCASUS
Abstract
The Southern Caucasus continues to be a major focus of attention. Its unique geographical location and geopolitical importance are enhanced by its substantial hydrocarbon reserves. A key role in the region’s energy sector is played by Azerbaijan, which has achieved significant successes. Pipeline projects implemented in the early 21st century have enabled Azerbaijan to become an exporter of Caspian oil and gas to the European market. Western energy companies and government structures have played a major part in this process, providing financial assistance and political support for the new pipeline projects. Their involvement in creating alternative routes for oil and gas transportation from the Caspian region has increased the role of Georgia, since export pipelines run through its territory. At the same time, Armenia was excluded from the discussion of energy projects owing to political factors. The Nagorno-Karabakh conflict and close relations with Russia in the 1990s became an obstacle to its participation in new pipeline projects. In the last decade, the energy situation in the Southern Caucasus has changed radically. The implementation of pipeline projects initiated by Western countries has strengthened the position of Azerbaijan and Georgia, creating conditions for the development of new projects. At the same time, Baku is no longer oriented only towards Western countries, but has expanded its cooperation with Turkey. The energy factor has played a key role in strengthening the Turkish-Azerbaijani tandem, paving the way for its expansion to include Georgia. This triple alliance, in which Turkey holds the leading position, has allowed Ankara to significantly expand its presence in the Southern Caucasus and to increase its influence on the political, economic, and cultural development of Azerbaijan and Georgia. New pipeline projects involving Azerbaijan, Georgia, and Turkey are to be implemented in the next few years. This will open a new page in the energy history of the Southern Caucasus. However, it should be emphasized that in recent years Azerbaijan has met with some difficulties in oil and gas production. This fact rules out the possibility of stronger competition between Russia and Azerbaijan for the European market in the coming years. Nevertheless, the sphere of oil and gas production and export in the Southern Caucasus will have a crucial effect on the development of the region, so that it will remain a focus of attention in the foreign policy of non-regional states.
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