Commentaries

Escalation on the Armenian-Azerbaijani Border may also be due to Russia’s Gas Interests

by Jeyhun Mahmudlu

On July 12, 2020, there was a military escalation in the Tovuz section of the Armenian-Azerbaijani border. In this escalation, the first thing that attracts attention is the lack of a proper response from Russia in support of Armenia. So, unlike the April 2016 war, the leading Russian media unexpectedly for many took the side of Azerbaijan or remained neutral. Although the responsibilities of CSTO include military support for Armenia as an ally in case of aggression against it, the organization did not react to the escalation, limiting itself to calling on the parties to observe the ceasefire. As a rule, the CSTO created a certain semblance of concern about what was happening. However, this time, when positional clashes took place not in the Nagorno-Karabakh zone but directly on the Armenian-Azerbaijani border, the CSTO did not react to the situation.

Moreover, Russian State Duma deputy Konstantin Zatulin, who has always supported Armenia, said in a conversation with Armenian journalists at the beginning of July that Russia would fulfill its obligations to Armenia as an ally in the CSTO. However, a few days after a military escalation on the border started, Zatulin directly accused Armenia of military provocation against Azerbaijan. Another well-known Russian TV presenter Vladimir Solovyov, who also always spoke on the side of Armenia, referring to the clashes between Azerbaijan and Armenia, also began to stick to the Azerbaijani side, indirectly accusing the Armenian army of provocation.

President of the Russian Federation Vladimir Putin, only five days after the start of hostilities, on July 17, held a meeting of the Security Council, at which he discussed with its members the situation on the border of Armenia and Azerbaijan and noted Moscow’s readiness to mediate in the conflict. It is noteworthy that large-scale exercises began in Russia on the same day as part of a surprise check of troops. Troops of the Southern and Western military districts, separate formations of central subordination, the Airborne Forces, and the marines of the Northern and Pacific fleets took part in these events. At the same time, in a telephone conversation between the heads of the defense departments of Russia and Azerbaijan, Sergei Shoigu and Zakir Hasanov, the Russian minister assured his Azerbaijani counterpart that a sudden check of the troops is a planned event that has nothing to do with the aggravation of relations between Azerbaijan and Armenia. Later, Shoigu’s deputy, Alexander Fomin, in an official statement from the Ministry of Defense, categorically rejected any connection between the check on the combat readiness of the troops and the aggravation on the Armenian-Azerbaijani border.

The above facts give reason to believe that Russia, through Azerbaijan, decided to teach Armenia a lesson and demonstrate that without Moscow’s help, Yerevan would not be able to withstand a military confrontation with Baku for a long time. It is not excluded that this is a particular signal for Baku to intensify military actions against Armenia. It should be noted that over the recent period, namely after Nikol Pashinyan came to power in Yerevan, the Armenian-Russian relations have been gone through a crisis, and it is logical to assume that the clashes between Armenia and Azerbaijan are beneficial to Russia for putting pressure on the new leadership in Yerevan. Thus, it is no coincidence that a little earlier, not without the participation of Moscow, a scandal began to flare up in Armenia over the involvement of the Pashinyan family in international arms smuggling.

In addition, the escalation between Azerbaijan and Armenia is beneficial for Russia to strengthen its political and economic influence on these countries. So, on July 17, a meeting of the Eurasian Intergovernmental Council took place in Minsk. Despite the aggravation of the conflict with Azerbaijan and the deterioration of the situation with the spread of coronavirus, Prime Minister of Armenia Nikol Pashinyan arrived in the capital of Belarus. Although at the end of June, Pashinyan refused to fly to Moscow for the Victory Parade postponed from May 9, the reason he called the problematic situation with COVID-19 in Armenia. Since then, the coronavirus situation in Armenia has worsened rather than improved. Pashinyan’s visit to Minsk, where he also held bilateral meetings, testifies to the fact that Russia’s position in the clash on the Armenian-Azerbaijani border influenced his decisions.

Against the background of the military escalation, the Azerbaijani media reported that SOCAR resumed oil exports via the Baku-Novorossiysk oil pipeline from July 17, which had been suspended since the beginning of this year. This decision coincided with the clashes on the Armenian-Azerbaijani border in the zone where the Baku-Tbilisi-Ceyhan, Baku-Tbilisi-Erzurum, and TANAP pipelines pass. This coincidence is not intended to be accidental.

Indeed, it is not profitable for Azerbaijan to export its hydrocarbon raw materials via the Baku-Novorossiysk pipeline because the Azeri Light brand is being mixed with the Ural brand. In this regard, the price of Azerbaijani oil falls by $ 10. Against the background of low world oil prices, this circumstance significantly reduces the country’s income. In addition, on July 13, a telephone conversation took place between Putin and Turkish President Recep Tayyip Erdogan. In a message published on the Kremlin’s website, it is noted that the conversation took place at the initiative of the Turkish side. The parties discussed issues related to the fight against coronavirus, the situation in Libya and Syria, as well as issues of bilateral economic cooperation. Considering the high level of Azerbaijani-Turkish relations, it is possible that during the telephone conversation, the parties also touched upon the topic of clashes on the Armenian-Azerbaijani border. Moreover, the incident took place close to the zone of the passage of pipelines toward Turkey.

In May, it was reported that the Blue Stream gas pipeline, which runs through the Black Sea to Turkey, was closed for maintenance. Despite the completion of these works, the gas pipeline is still idle. This is because Turkey has sharply reduced gas imports from Russia over the year, and now one branch of the Turkish Stream is enough for supplies. Instead of purchasing pipeline gas, the country is increasingly focusing on liquefied natural gas (LNG) imports. Back in March 2019, Russia was the main gas supplier to the Turkish market (33% of the market). However, in March 2020, supplies to Turkey decreased by 72%. Four countries immediately overtook Russia in terms of supply – Azerbaijan (share – 23.5%) and Iran (14.2%), and in terms of supplies of liquefied natural gas (LNG) – Qatar (20%) and Algeria (13.7%). The share of Russia was only 9.9% (389.7 million cubic meters).

According to the Federal Customs Service of Russia, Gazprom’s revenues from gas exports in the first five months of 2020 fell by 53% compared to the same period in 2019, to $ 9.7 billion, in May gas sold for $ 1.12 billion. In May 2020, the average gas export price amounted to $ 132.7 per 1,000 cubic meters, down 38% from last year’s levels. The drop in Russian gas exports is associated with a downturn in the European market due to the coronavirus pandemic. Meanwhile, the construction of the Nord Stream 2 gas pipeline, through which it is planned to supply 55 billion cubic meters of gas a year from Russia to Europe, is again facing problems. On July 15, US Secretary of State Mike Pompeo called on the Nord Stream 2 partner companies to end their cooperation on the gas pipeline. According to him, the US government has decided to impose additional sanctions on the Nord Stream 2 and Turkish Stream projects.

While considering the information mentioned above, it can be assumed that the armed clashes on the Armenian-Azerbaijani border near the pipelines to Turkey and further to Europe are connected with Russia’s desire to regain control of the Turkish gas market. It is no coincidence that the aide to the Azerbaijani president, head of the foreign policy department of the presidential administration, Hikmet Hajiyev, in an interview with the Canadian CTV News channel, noted that “Armenia, making this attack, pursued the goal of creating a threat to the East-West corridor and oil and gas pipelines passing through this territory.” Against the background of the recession in the global economy, which had an impact on the export of Russian gas to Turkey and European countries, Azerbaijan intends to start delivering 10 billion cubic meters of gas to Europe from the end of 2020 and is becoming Russia’s main competitor. Judging by the information that the transportation of oil through the Baku-Novorossiysk pipeline has begun, it was evident that the Azerbaijani authorities have drawn appropriate conclusions from the current situation. How such circumstances will affect the activities of the TANAP project will be shown in the near future. There is no reason to assume that the current situation will have an impact on the settlement of the Nagorno-Karabakh conflict. As events have shown, Russia received a weighty reason to strengthen its moderation and delay the settlement of the conflict.