Changing Geopolitics in the South Caucasus

Solving current conflicts is important, but preventing future ones before they happen is paramount to global security. While U.S. foreign policy has been preoccupied with conflicts in Syria, Ukraine, and disputes in the South China Sea, the changing geopolitical environment in the South Caucasus calls for more robust U.S. policy to promote security in the energy-rich region. On March 31 and April 1, 2016, President Obama hosted the Fourth Nuclear Security Summit in Washington, D.C. in which leaders from Caucasus nations were in attendance, including Georgia, Armenia, and Azerbaijan. Although preventing the spread of nuclear weapons was the focus of the agenda, there is a need to push for stability in the South Caucasus given the volatility, particularly in recent days. Prompting a peace deal regarding the disputed Nagorno-Karabakh territory would both downplay the divide between NATO and Russia and lead to greater security in the broader Caucasus region. The U.S. must act now and do so diplomatically.

Flaring Up

Nagorno-Karabakh is a landlocked, mountainous region of Azerbaijan that is claimed, supported, and populated by ethnic Armenians. The regional conflict has long been an issue of contention between Armenians and Azerbaijanis that accelerated after the collapse of the Soviet Union in 1991 and ended in a shaky ceasefire in 1994. Recently, Armenia shot down an Azerbaijani helicopter leading to the largest hostilities since the 1994 ceasefire. Although both sides recently agreed to temporarily end hostilities, this frozen conflict is one which could have profound implication if and when fighting resumes, and it will.

Currently, with increased weapons sales from Russia to Armenia and an unwillingness on Russia’s behalf to support a political solution, the Nagorno-Karabakh conflict will continue to explode into a regional South Caucasian conflict, destabilizing energy prices and threatening regional U.S. allies, Georgia and Turkey. With the rise in Russia’s overseas military involvements indicated by its annexation of Crimea and military engagements in eastern Ukraine and Syria, Washington could and should use its political leverage to alter Moscow’s increasingly militaristic behavior. Although it works in Russia’s favor to maintain these frozen conflicts to prevent these countries from attempting to join NATO or the EU, it is very disastrous behavior which must be addressed by the U.S. While Russia is a part of the Minsk Group, a segment of the OSCE tasked with finding a solution to the Nagorno-Karabakh conflict, Russia has been more concerned about growing its global influence than about peace in the Caucasus. It has pursued deals to maximize its energy dominance in the region, recently made huge weapons sales to Armenia, and is increasing military activity at its bases on the Armenian-Turkish border. By doing this, Russia has increasingly marginalized energy-rich Azerbaijan, and is fueling divisions with Turkey, who recently shot down a Russian jet near the Syrian-Turkish border.

Global Energy Prices

The South Caucasus is geopolitically important in terms of energy. For decades, the U.S. and EU have tried to promote the development of oil and gas resources in Azerbaijan and Central Asia as new alternatives for European consumers. In doing so, the Western partners have attempted to break Russia’s energy monopoly in the region. Those plans have only been somewhat successful, but Russia continues to reign supreme. Azerbaijan is making strides to become an alternative provider though. Currently, Azerbaijan supplies 90 percent of Georgia’s gas demands. It is also speeding up a project to provide gas to Turkey, Greece, Italy, and other EU countries via the TANAP (Trans-Anatolian Pipeline Project). However, any conflict in the region between Armenia and Azerbaijan would likely destabilize prices by halting supplies to Western allies in the region, thus driving up global prices and increasing Russia’s regional energy advantage. In addition, this would open the region to increased Iranian influence, which could also prove destabilizing until Iran shows seriousness about being a mature global player. Recent reports of Iran shipping weapons to its various proxies proves that Iran has not reached this point yet.

Iran’s Role

With Iran coming off of U.S. sanctions, it is looking to increase its energy market share in the Caucasus, particularly to Georgia.  Iran wants regional security, since renewed conflict over Nagorno-Karabakh would take place very close to home. However, in the past Iran has supported Azerbaijan against Armenia in the conflict in the past. While this previous support was based on cultural ties, dynamics are changing. Iran trained Azeri troops and cared for the wounded in their medical centers and supported Azerbaijan by contributing troops to the conflict. However, it is now competing with Azerbaijan in a regional energy competition, and relations may soon cool between the two, especially in a low oil price environment. Recently, Iran has tried to play both countries against each other like Russia, warming to Armenia as it engaged in energy disputes with Azerbaijan. Armenia and Iran have increased their energy cooperation in recent years, which could lead to Iranian support for Armenia should a future conflict take place.

Harmonization of Efforts

Although the conflict in Syria has nearly half a million civilians based on estimates, so far a cease-fire brokered between the U.S. and Russia has held up. This cease-fire proves that although the U.S. and Russia, global leader, have fundamental differences, cooperation can and will take place when our interests align. This happened during the Cold War, it is happening in the wake of the Soviet collapse, and it will continue to happen in the future. This cease-fire and hopeful peace deal could be a template for a solution in the Caucasus where unlikely parties such as the U.S., Iran, and Russia negotiate the terms of the deal. Any deal would have to address Russia’s military support to both parties which is fueling the conflict. Additionally, the U.S. may be advised not to increase military activity in Georgia or engage in saber-rattling rhetoric against Iran and Russia, but it should be forceful in its diplomatic efforts to convey the importance of a solution with Nagorno-Karabakh. It is crucial that the current U.S. president and prominent diplomats set the stage for this future deal by hosting a series of meeting with the leaders of Armenia and Azerbaijan to ensure them both that the U.S. is committed to peace, despite being involved with more pressing issues in the greater Middle East. Even in the wake of the nuclear summit and recent hostilities, these meetings should be followed up with more diplomatic visits to the Caucasus to show the U.S.’ willingness and seriousness to make the Caucasus a priority.

Vital to this diplomatic effort would be a new task force formed to replace the Minsk Group, which has not produced any effective results for years. This task force should include the U.S.; regional stakeholders such as Russia, Iran, Turkey; and the disputing countries, Armenia and Azerbaijan. It should include representation not only from prominent diplomats of all countries, but also from leading energy and security analysts and key businesses stakeholders who are either already active in the region or hope to be once the conflict settles. Failure on the part of the U.S. to act now could be interpreted as a lack of seriousness, and the conflict could erupt again into a major war which in turn draw in an unprepared and increasingly restrained U.S.

Author Biography

Pharohl Charles is a Master of Science in Global Affairs candidate at New York University concentrating on energy policy and transnational security. He is currently an intern at the Eurasia Program at Open Society Foundations. He received a Bachelor of Arts in International Studies, with a double minor in Political Science and Russian from California State University, Long Beach. His research and academic interests lie in U.S. foreign policy in the former Soviet Union as well as the rapprochement of U.S.-Russian relations. He has traveled to conduct his thesis research on emerging security threats in Eurasia such as extremism and regime change and how to respond to them. He speaks conversational Russian and does photography in his off time.

Cover Image: Marco Fieber under a CC BY-NC-ND 2.0 creative commons license

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