PSCRP-BESA Reports No 116 (February 21, 2025)
by Alexander Shpunt
The rapid surge in the volatility of political processes globally, particularly in Israel’s geopolitical landscape over the past two years, has brought about an unexpected outcome: longstanding geopolitical analysis methods, developed over decades, have started to fall behind the swift changes occurring in the very subject they aim to study.
This fully applies to the analysis of the map of interests of the participants in the big game around the Zangezur Corridor—a 40-kilometer-long extraterritorial logistics route connecting two parts of Azerbaijan: the main Caspian region and the pro-Turkish territory of the Nakhchivan Autonomous Republic. On the political map, this route passes through the sovereign territory of Armenia. However, as we have often observed recently, political and geopolitical maps are beginning to differ significantly.
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The idea of creating the Zangezur Corridor has its roots in the Soviet Union era. It envisaged connecting the main territory of Azerbaijan with the Nakhchivan Autonomous Republic through the construction of a railway through the Zangezur region of Armenia. After the first Karabakh War (1992–1994), traveling from Azerbaijan to Nakhchivan became possible only through Iran (a 700 km route), Georgia, or Turkey (a 1,200 km route). The Zangezur route could have reduced this distance to 50 km, but it was never realized due to the conflict between Yerevan and Baku.
The key word in this description is “travel.” The Soviet Union’s economic logic, built on isolationism combined with a policy of forming a single Soviet people, primarily viewed the Zangezur Corridor project as a passenger route and, to a lesser extent, as a regional freight corridor. Cross-border communications in the USSR were mainly concentrated along its western border. For instance, in 1962, the USSR planned to send only 1.247 million tons of oil to China (out of a total production of 186.2 million tons). Similarly, eastern cross-border trade accounted for about 0.5% of the total freight flows of the USSR.
In the early 1990s, the collapse of the Soviet economy led to the reversal of trade flows in the former republics (including independent Azerbaijan), from intra-post-Soviet communication to communication with neighboring countries. During this period, the passenger logic of the Zangezur Corridor was supplemented by the logic of container transport. This perspective on the geopolitical game around the Zangezur Corridor was maintained in analytical circles for more than a third of a century.
The events of the past two years—from the onset of large-scale military actions in southeastern Ukraine and Russia in March 2022 to the collapse of the Syrian government in December 2024—completely overturned this logic.
The main dimension of the geopolitical game around the Zangezur Corridor has become the pipeline logistics of hydrocarbons, a topic on which there are still very few analytical materials. This text from the Begin-Sadat Center aims to partially fill this analytical gap.
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At the very beginning of the Armenia-Azerbaijan confrontation over Nagorno-Karabakh, the U.S. State Department, represented by Paul Globe, an employee of the Bureau of Intelligence and Research, proposed a formula to exchange Nagorno-Karabakh (according to other sources, a part of Nagorno-Karabakh) for a territory enabling the creation of a corridor between the two parts of Azerbaijan. Gareth Wernoff wrote about the U.S. role in Turkey and the Caucasus: Domestic Interests and Security Concerns. Other sources cite then-Turkish Foreign Minister Hikmet Cetin as the author of the plan. In any case, Turkey was among those who enthusiastically supported the idea of exchanging sovereign territories. However, this approach was unacceptable for Armenia, and that same year the first Karabakh War began, ending with a military victory for Yerevan, the occupation of one-quarter of Azerbaijan’s territory, and Armenia gaining control over Nagorno-Karabakh.
For twenty-seven years, the situation remained frozen in this form until, in 2020, the second Karabakh War ended with Armenia’s complete defeat, the return of all occupied territories, and a sharp weakening of Yerevan’s political resources. The fact that Azerbaijani tanks stopped at the border of Armenia’s internationally recognized territory created an opportunity for a peace treaty, under which the question arose of Yerevan’s recognition of Azerbaijan’s territorial integrity (this was already rhetorically acknowledged by the Armenian president in April 2023), border demarcation (which began in April last year), and the status of the Zangezur Corridor.
The ceasefire agreement signed on the night of November 10, 2020, after Armenia’s defeat, contains Clause 9, which, in particular, requires Armenia to: “The Republic of Armenia guarantees the safety of transportation between the western regions of the Republic of Azerbaijan and the Nakhchivan Autonomous Republic for the purpose of unimpeded movement of citizens, vehicles, and goods in both directions.” As we can see, such wording opens up a wide range of interpretations regarding the actual control regime of the Zangezur logistics route by Yerevan and Baku, but territorial exchanges are no longer being discussed.
At the beginning of this year, on January 7, President Ilham Aliyev said: “The Zangezur Corridor must and will be opened. The sooner they [the authorities in Yerevan] understand this, the better”—and we tend to agree with this. Both the domestic political crisis in Armenia and the foreign policy stance of global players in this conflict favor Baku. Therefore, we will further discuss not the possibility of creating a Baku-controlled logistics route through Zangezur but its geopolitical and geo-economic implications—and, of course, primarily from the perspective of Israeli interests.
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The sequential change in global hydrocarbon logistics routes, in the context of changing world technological structures, was disrupted in late February 2022 by the onset of large-scale military actions in Ukraine and, subsequently, Russia, and the avalanche-like expansion of sanctions against the primary export component of Russia’s budget—hydrocarbons.
The direct consequence of military actions was the obvious and inevitable cessation of the Ukrainian route for gas from Russia to Europe. Russian oil was transported through Ukraine to Europe via the “Druzhba” pipeline—the southern branch of “Druzhba” passes through western Ukraine and extends to Eastern European countries: Hungary (2.84 million tons or 46% of all supplies), Slovakia (1.92 million tons or 31%), and the Czech Republic (1.46 million tons or 23%). It may seem surprising, but even in 2024, about 11.36 million tons of Russian oil were transported via the southern branch of the “Druzhba” pipeline, which, although the lowest since 2014, maintained normal energy supply to Eastern Europe.
Regarding supplies in 2025, Ukrainian authorities send mixed signals to the market. For instance, on August 30 last year, Mykhailo Podolyak, an influential advisor to the Office of the President of Ukraine, stated that in 2025, Ukraine would completely cease the transit of Russian oil and gas through its territory. At the same time, Podolyak noted that if European countries wished to receive gas from Kazakhstan or Azerbaijan, Ukraine would be ready to facilitate transit, provided appropriate logistics, legal foundations, and contracts are in place. However, the very next day, Oleksiy Chernyshov, CEO of the Ukrainian state energy company Naftogaz, sharply refuted the Office of the President in a comment to Bloomberg: “I categorically deny rumors about the cessation of oil transportation to Europe before the end of the contract,” he said, emphasizing that Kyiv remains a reliable partner for the EU.
Subsequently, Zelensky’s office reported its readiness to fulfill oil supply obligations through the “Druzhba” pipeline until 2029, but the degree of uncertainty in Eastern European markets is already reflected in the strategic plans of these countries to abandon this route as quickly as possible. In addition to political factors, there are also purely military concerns and the wear and tear of the primary pumping infrastructure.
As for gas transit through Ukraine’s pipeline system, the five-year contract for Russian gas transit to Europe via Ukraine expired last year, and deliveries were halted as of 8:00 Moscow time on January 1, 2025.
Even greater changes to the global hydrocarbon logistics system, which had developed over decades, were introduced by sanctions against Russia, which already number in the thousands. This extensive topic deserves a separate analysis. Here we briefly note: Russian oil and gas have become politically toxic for EU consumers, and neither Russia’s discount strategies, its shadow tanker fleet, nor other mechanisms can change this circumstance.
In conclusion, it can be said that Europe’s demand for non-Russian oil and gas from the East—Azerbaijani, Kazakh, Turkmen—and their non-Russian transit significantly surpasses their ordinary market attractiveness.
In this context, the pipeline dimension of the Zangezur Corridor—and competing logistics routes—comes to the forefront of the geopolitical strategies of all players in the political game of the Greater Middle East region.
In this regard, we will try to reveal in this part of the analysis the geopolitical outcomes of the emergence of an effective modern pipeline system for hydrocarbon delivery in the Zangezur Corridor.
It is logical to start with the winner of the Second Karabakh War, Azerbaijan, and one of its allies – Turkey. In 2024, Azerbaijan’s oil production, including condensate, amounted to 29.1 million tons, and exports reached 24.4 million tons. In the same year, Azerbaijan exported 25.2 billion cubic meters of gas, a 5.8% increase from 2023. Of this, 12.9 billion cubic meters were sent to Europe (51% of total exports), 9.9 billion cubic meters to Turkey (39% of exports), and 2.4 billion cubic meters to Georgia (10% of exports).
Azerbaijani gas is supplied to the EU through a chain of three pipelines: the “Baku–Tbilisi–Erzurum” pipeline, followed by the TANAP pipeline, which runs through Turkey to the Greek border, and the TAP pipeline, connecting Greece, Albania, and southern Italy.
Azerbaijani oil has a more diversified logistics route toward Europe. This includes Russian routes (Baku–Grozny–Tikhoretsk–Novorossiysk, also known as the Northern Early Oil Pipeline), the Georgian route (Baku–Tbilisi–Supsa, also known as the Western Early Oil Pipeline), and the Turkish direction (Baku–Tbilisi–Ceyhan, or BTC). An economic and sectoral analysis of these routes is not the task of this analysis; geopolitically, it is significant that all these routes pass through Georgian or Russian territories, with BTC also crossing Turkish territory.
The policy vector of Georgia, which has been moving closer to the EU over the past two years, has sharply changed, swinging towards strengthening ties with Russia. The reason for this is not a shift in the sympathies of Georgian civil society but the pragmatism of Georgian business elites, whose business—both legal and shadow—is largely oriented toward Russia. Since the beginning of the conflict in southeastern Ukraine and Russia, Moscow has sent clear signals to Tbilisi’s business circles, accompanied by unprecedented concessions and equally unprecedented threats.
As a result, the political risks for Baku regarding the Georgian route have multiplied many times, and the advantages of a pipeline bypassing Georgia—namely the Zangezur Corridor—have increased proportionally.
As for Turkish-Azerbaijani relations, the Zangezur route also significantly changes the picture. Only 17 kilometers of the border between Turkey and Nakhchivan become for Ankara a gateway to secure the supply of hydrocarbons from the safe allied Turkic-speaking Azerbaijan, bypassing unstable and unpredictable Georgia, reducing dependence on the increasingly toxic Russian schemes, and lessening the dependency of eastern Turkey on supplies through the politically turbulent Syrian border.
But even more benefits accrue to Baku. From a subordinate position as Ankara’s junior partner, satellite, and almost proxy, Azerbaijan’s leader and his country become a key link in ensuring Erdogan’s economic security and his far-reaching plans, which align far better with Ilham Aliyev’s persona than the role of a junior ally.
Undoubtedly, the biggest loser with the opening of the Zangezur Corridor is Russia. Here, multiple vectors emerge along which Moscow’s geopolitical positions weaken.
First of all, the long and resource-intensive political game to shift Tbilisi’s interests from closer EU integration toward alignment with Moscow loses much of its purpose. Georgia ceases to be a monopoly on the non-Russian route for transporting hydrocarbons from Kazakhstan and Turkmenistan, which undermines Moscow’s ability to exert pressure on these countries using the Moscow-Tbilisi link and the lack of other routes for Kazakhstan and Turkmenistan besides the Russian and Georgian ones.
Of course, there are also direct losses from the decline (or possibly the complete cessation) of the Russian route for the transit of Azerbaijani oil, although these are less significant for Moscow. More importantly, Russia loses yet another lever of influence over Azerbaijan—the transit lever.
The growing influence of Turkey, a longstanding geopolitical rival of Russia with a history of fourteen direct conflicts, in the South Caucasus region, coupled with unfavorable developments for Moscow in Armenia—traditionally regarded as a near-proxy for Russian interests in the area—poses a significant risk of Russia losing almost all influence in this strategically vital region, which borders the Greater Middle East.
Moscow becomes less interesting to Turkey as a gas supplier in the context of Ankara’s plans to become the southern gas hub for Europe. There is an opportunity to abandon toxic Russian gas and the highly risky South Stream pipelines passing through the war-torn waters of the Black Sea. The even more politically risky project of Russian-built nuclear energy blocks in Akkuyu in Turkey’s southern Mersin province (four energy blocks with a total capacity of 4,900 megawatts, covering up to 10% of Turkey’s electricity needs) also becomes less attractive for Turkey.
Another systemic opponent of the Zangezur logistics route historically has been Iran.
Direct oil and gas interactions between Baku and Tehran are complex and multifaceted. At different periods and under various agreements, Tehran has served as a supplier of hydrocarbons to Baku, evidenced by a 65% increase in the value and a 16% rise in the volume of Iran’s non-oil exports to Azerbaijan from March 20 to August 21, 2024, compared to the same period in the previous year.
Even these examples and illustrations show how complex the oil and gas relationship between Iran and Azerbaijan is. The opportunities opened up by the Zangezur pipeline logistics route cut through this knot like a knife through butter.
In conclusion, we need to analyze the direct results of the new hydrocarbon pipeline route for Israel.
The direct route of Central Asian and Azerbaijani hydrocarbons to Turkey’s border will strengthen Turkey’s energy security, further fueling its president’s ambitions to become the region’s overseer. Reduced interest in Russian hydrocarbons will weaken Turkish-Russian interaction across the board, and the ability to freely supply the most remote and least developed eastern regions of Turkey with energy will allow Erdogan to act much more freely on the Syrian and Iraqi fronts.
A significant cooling of Azerbaijan’s energy cooperation with Tehran will result in heightened risks for the Iranian leadership, pushing it from its current cautious stance on direct confrontation with Israel to an openly military interstate conflict.
This study deliberately did not mention the U.S. and China, limiting itself to regional contexts. The influence of changes in hydrocarbon logistics in the Greater Middle East, including the Zangezur Corridor, on the policies of major powers deserves a separate report.
Alexander Shpunt is Israeli and Russian researcher and expert in theory and practice of information and analytical work in the field of politics, resides in Haifa. Since 2016 he served as a professor at the National Research University “Moscow Higher School of Economics. In 1999 – 2011 he also served as the Executive director of the “Effective Policy Foundation”, the largest think-tank in the RF at that time, and in 2011founded and headed the Institute of Political Analysis Tools, specializing in systems for monitoring political behavior.