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EU New Memorandum of Understanding with Azerbaijan. New dynamics.

Source: eureporter.co.


As is well known, the beginning of the war in Ukraine last February put an end to Russian supremacy in oil and gas provision.

In the past few months, the European Union and its member states have been striving to strike deals with other major fossil fuel producers to reduce and ultimately cut their reliance on Russia.

In line with the new dynamics, on July 18th, a new gas deal was signed by the EU in Azerbaijan. This is expected to support the diversification of energy supplies.

But not only that. In the long term, the EU's scramble toward new fossil fuel supplies will result in countless deals, and a well-evident geographical shift will also entail relevant geopolitical rearrangements.

The EU, in the person of the President of the EU Commission, Ursula von der Leyen, signed a memorandum of understanding with the President of Azerbaijan, Ilham Aliyev, in Baku.

The Commissioner for Energy, Kadri Simson, and the Azeri Energy Minister, Parviz Shahbazov, were also present at the meeting. 

The Memorandum stresses the commitment to increase the Southern Gas Corridor's capacity to provide no less than 20 billion cubic meters to the EU annually by 2027.

This is in line with the goals declared in the recent energy plan issued by the EU, the REPowerEU Plan, whose main objective is energy diversification. Thanks to this reviewed cooperation, Azerbaijan has started increasing shipments of natural gas to the EU, from 8.1 billion cubic meters in 2021 to an expected 12 bcm in 2022.

President von der Leyen expressed her satisfaction by stressing the importance of Azerbaijan both in the present and the future.

“Today, with this new Memorandum of Understanding, we are opening a new chapter in our energy cooperation with Azerbaijan, a key partner in our efforts to move away from Russian fossil fuels.”

For Azerbaijan, the enhanced cooperation with the EU represents a good asset.

As Al Jazeera reported, the Azerbaijani President commented on the meeting saying that “issues of energy security today are more important than ever before” and “long-lasting, predictable and very reliable cooperation between EU and Azerbaijan in the field of energy is a big asset.”

The energy epicenter will gradually and swiftly shift through this memorandum as well as the overall EU energy diversification policies. This implies not only an obvious geographical shift but also a geopolitical one concerning the major pipelines involved.

While the pipeline North Stream 1 is currently closed due to maintenance work and is expected to resume its activities tomorrow, causing endless speculation on whether Russia will open it again and, in that case, whether the flow will be reduced, it seems now the other pipelines have great potential to take the lead.

Now it looks like the Southern Gas Corridor will become even more important as it is the main link between Azerbaijani gas and Europe. The new EU memorandum acknowledges this openly.

It should not be forgotten that the pipeline runs through Turkey. This means that, besides good relations with Azerbaijan, excellent relations with Turkey are of the essence.

Not coincidentally, the new agreement includes an important statement for those who can read between its lines.

“The Sides also emphasise their commitment to the respect for and support to the territorial integrity, inviolability of international borders, independence, sovereignty of each other, including all EU Member States, as well as to the principle of good neighborly relations”.

When it comes to territorial integrity and inviolability of international borders, the mind runs inevitably to the 2020 Karabakh war. Back then, the EU's intervention in the conflict resolution process was rather timid. 

While some EU member states expressed explicit support for one of the two sides, implying indirect support for Turkey, which has long supported Azerbaijan's territorial integrity, the EU, as a unitary body, took a cautious stance.

More strategic thinking was warranted. The EU, already back then, was aware of the need to gradually open up to other energy suppliers and reduce dependency on Russia.

Discussions on issues concerning human rights and the rule of law, often within the European Neighbourhood Policy, were often carried out at an EU level. Nevertheless, genuine strategic thinking needs to focus on geopolitical grounds.

The EU never forgets that Azerbaijan and Turkey are the key players in the EU diversification policies as the major oil and gas infrastructures run through these two countries.

It was not a coincidence that, when in 2005, within the Neighbourhood Policy, the EU attempted to develop and negotiate action plans with Armenia, Georgia, and Azerbaijan, it avoided mentioning, though, the Karabakh conflict and relevant issues of territorial integrity in the region to avert any sort of political intervention.

This created ambiguous situations, especially because Azerbaijan required from the EU the acknowledgment of its territorial integrity.

Accordingly, in line with the decisions taken in the cases of Georgia and Moldova, the EU viewed Azerbaijan's attempts to include the topic of territorial integrity as an unnecessary politicization of the Action Plan. At the same time, though, Armenia managed to incorporate into its action plan the notion of the right of the nations to self-determination without mentioning the principle of respect for other countries’ territorial integrity as one of the guiding principles for conflict resolution.

At this point, it should be noted that, according to international law, the Karabakh region is de jure Azerbaijani territory, something that sometimes seems to be deliberately forgotten.

With the backdrop of Russia's war in Ukraine, or "special operation," as the Kremlin calls it, the EU reminded itself and the rest of the world that strategic thinking and material issues are more important than propaganda and empty words.

Nevertheless, the EU is still being cautious about opening its cards too much. The text of the memorandum is clear about this.

Despite the EU and Azerbaijan's aspiration to boost bilateral trade in natural gas to reach 20 billion cubic meters annually by 2027, the last clause of the agreement seems to temper the enthusiasm.

Accordingly, “nothing in this Memorandum of Understanding should create any binding legal or financial obligations or commitments between the Sides or concerning any third party under domestic or international law. This Memorandum of Understanding does not constitute an obligation to allocate funds.”

Is this just a cautious step from the EU side? Is this an attempt to conceal the "energy despair" result of the several sanctions packages imposed on Russia? Is the EU concerned about the fact that, before imposing sanctions on its major fossil fuel supplier, it should have secured alternative sources? Only time will show.

The very recent Turkish entente with Iran and Russia, as underlined by the meeting between the three leaders that took place in Tehran, showed that the eastern world seems to be finding a common medium of communication unknown to the west.

Not to mention the June 2022 BRICS summit hosted in China, bound to usher in a new era. Chinese media have been clear in this regard: the organization of emerging economies is enhancing "multilateral cooperation with non-Western styles, forms, and principles," in a world where "the US (is) pulling its Western allies to rebel against globalisation."

For the west, and mainly the EU, given its geographical proximity, the only certainty in this fluid situation is that it cannot afford to fuel further enmity with Turkey and Azerbaijan. This is not anymore about ideology and cultural affinities; it is about material survival. 



Edited by: Sara Moreira

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