Azerbaijan Seeks a Balance Between Russia and the West

June 18, 2014 | 0135 GMT

Russian Foreign Minister Sergei Lavrov arrived in Baku on Tuesday at a time when Azerbaijan is becoming more important not only in its immediate Caucasus region, but also the entire Eurasian borderlands. Though Ukraine continues to dominate the headlines as fighting rages in the east and Russia threatens to cut off natural gas supplies, it is hardly the only geopolitically significant country in the region. Azerbaijan, too, is important not only as a contested country itself, but also for the pivotal role it could play in the broader east-west struggle.

Azerbaijan finds itself in a unique situation when it comes to the competition between Russia and the West over the former Soviet periphery. It is not in the camp of countries such as Ukraine, Moldova and Georgia that are striving to get closer to the West. Nor is it among the countries such as Belarus and Armenia that are strengthening their ties with Russia. Instead, Azerbaijan has preferred to stay out of both the Russian and the Western blocs, eschewing their respective integration schemes.

In this context, it is notable that on the same day Lavrov was in Baku to meet with his Azerbaijani counterpart, Russian Regional Development Minister Igor Slyuniayev said in an interview with the Russian Business Gazette that Azerbaijan's eventual membership in the Eurasian Economic Community or the Commonwealth of Independent States' Customs Union is "quite a realistic prospect." This is not the first time Russia has floated such an idea; several mid-level Russian officials have made similar statements in recent months. However, Azerbaijan has consistently denied any plans to join the Customs Union (soon to be transformed into the Eurasian Union) whenever such suggestions have been made.

So why is Russia being so persistent when it comes to courting Baku? The reason is twofold: energy and location. Azerbaijan is unique among the former Soviet states in Eastern Europe and the Caucasus in that it is a significant producer of both oil and natural gas. And its location along the Caspian Sea and south of Russia's heartland allows Azerbaijan to export its energy in a way that avoids shipping these supplies through Russia and through unstable transit states like Ukraine.

This makes Azerbaijan very valuable to the Europeans, who are becoming increasingly nervous about their dependence on Russian energy supplies. This dependency poses a risk because of Russia's use of energy as a geopolitical tool and because of the ongoing natural gas dispute between Moscow and Kiev that threatens to once again disrupt Europe's supply, as it did in 2006 and 2009. Consequently, the Europeans are very interested in the role Azerbaijan could play in the southern corridor energy route, particularly in the Trans-Caspian pipeline project. Azerbaijani resources, if combined with those of other major energy producers in the region such as Turkmenistan, Iran or Iraq, could threaten Russia's energy position in Europe. This is a prospect that makes the Europeans extremely excited and Moscow extremely nervous.

But Moscow is not without its own trump cards. It has several sources of leverage over Baku, including its weapons exports to Azerbaijan, as well as a close relationship with Azerbaijan's regional rival Armenia. Russia has 5,000 troops stationed on Armenian territory, which essentially serve as a check to any Azerbaijani aspiration to reclaim the disputed territory of Nagorno-Karabakh. Russia also has troops stationed in Georgia's breakaway territories of Abkhazia and South Ossetia, which have been reinforced since the 2008 Russo-Georgia War and serve as a reminder to Azerbaijan of Russia's military and political capabilities in the Caucasus region. Moreover, Russia's naval presence in the Caspian Sea and influence in Turkmenistan give the Kremlin leverage over the future of the Trans-Caspian pipeline as well.

Despite all the leverage that Azerbaijan has, which is so lacking among other countries in Eastern Europe and the Caucasus, Baku is still heavily constrained by its external environment. Russia may be on the defensive now in Ukraine, but it remains a strong player throughout the former Soviet periphery. But at the same time, Baku can also use Lavrov's visit to raise the alarm in Washington. Azerbaijan wants the United States to recognize the strategic value it offers for containing Russia, and would prefer that Washington show greater support for Baku instead of criticism on human rights and other issues.

Ultimately, the name of the game for Azerbaijan is balance. Baku has been successful over the past decade at cooperating with both Russia and the West without getting close enough to one to provoke the other. Given the success of this balancing act, both in terms of amassing sizable energy revenues and avoiding entangling military alliances or foreign troops on its soil, this is something Azerbaijan would like to maintain for the foreseeable future. But because of the shifting geopolitical winds in the region and the escalating competition between Russia and the West, this will be a challenging prospect for Baku.