When discussing the relationship between Azerbaijan and the European Union, it is essential to take two key points into account. First and foremost, although the European Union often appears as a unified structure, it in fact comprises 27 individual member states. Therefore, relations between Azerbaijan and the EU inherently refer to Azerbaijan’s bilateral engagement with each of these 27 countries. In this regard, any generalization about Azerbaijan-EU relations essentially implies a summary of Azerbaijan’s interaction with each individual EU member state. Naturally, this assumption oversimplifies a far more complex and diverse diplomatic landscape. Secondly, since its inception, the European Union has functioned primarily as an economic integration project. At the core of this project lies the goal of fostering a unified European market. This foundation has enabled the development of strong economic ties among member states, particularly through mechanisms aimed at protecting European farmers and their products within a common market framework.
However, a purely economic lens falls short in capturing the full scope of Azerbaijan–EU relations.
These relations are best understood through a geo-economic perspective, where geopolitical interests and economic considerations are deeply intertwined. It is this fusion of politics and economics that shapes the past, present, and future trajectory of the EU–Azerbaijan partnership.
Energy cooperation forms the cornerstone of Azerbaijan–EU relations, rooted in a mutual geo-economic interdependence. Azerbaijan relies heavily on oil and gas revenues, which account for nearly 90% of its economy, with the majority of exports directed toward European markets. While oil exports are geographically flexible and can be transported via multiple routes—by tanker, rail, or road—natural gas presents significant logistical constraints. Transporting natural gas by sea requires it to be liquefied at –169°C under high pressure (25 KPa), necessitating costly infrastructure at both export and import terminals. These technical and financial barriers make pipelines the most viable and efficient method for gas delivery. Accordingly, Azerbaijan’s gas export infrastructure is strategically oriented westward—toward the European Union.
This westward orientation is not incidental. Azerbaijan's northern, southern, and eastern neighbors have limited demand for natural gas, leaving the EU as the sole substantial market. As a result, natural gas has become the defining element in Azerbaijan’s strategic relationship with the EU.
According to the Energy Transition Institute, Azerbaijan’s export earnings from gas surged from US $5.56 billion in 2021 to US $14.99 billion in 2022 and US $13.68 billion in 2023, surpassing revenues from oil exports for the first time in the country’s history—a watershed moment that confirms gas export revenues will continue to outpace oil starting in 2024, further reinforcing the EU as Azerbaijan’s primary and indispensable market.
On the surface, Azerbaijan’s role in the EU’s gas market may appear marginal—accounting for approximately 4.8% of the EU’s total gas imports in 2023, according to the European Commission’s Quarterly Gas Market Report—and ranking outside the top three suppliers. But a purely numerical assessment misses the deeper strategic significance.
For certain EU member states, particularly in Eastern and Southeastern Europe, Azerbaijani gas is not just a marginal addition—it represents a crucial alternative to Russian energy. Bulgaria, for instance, consumes roughly 3 billion m³ of gas annually, of which Azerbaijan already supplies about 1 billion m³ (≈33%) in 2023 under a long-term contract—and plans to increase it to 1.5–2 billion m³ in 2024, covering approximately 50– sixty‑seven percent of its total consumption—significantly reducing its dependency on Russian gas
Since the outbreak of the Russia–Ukraine war in 2022, energy security has become a geopolitical issue. Russia's use of energy as a coercive tool forced the EU to reassess its supply routes. Within this context, Azerbaijan emerged as a non-threatening and geopolitically neutral alternative—especially for countries like Italy, Greece, Bulgaria, Romania, and more recently Hungary, which have all turned to Azerbaijani gas. Ongoing discussions with Slovakia, Slovenia, and Croatia further reflect this growing trend.
This dynamic has elevated Azerbaijan’s role in the EU’s strategic calculations. Particularly in the Balkans—one of Europe’s most geopolitically sensitive regions—Azerbaijan is now viewed not just as an energy supplier, but as a stabilizing partner in counterbalancing Russian influence. Understanding this dynamic is essential, as it also shapes the EU’s approach to other dimensions of its relationship with Azerbaijan, including civil society cooperation, democracy promotion, and human rights. Geopolitical pragmatism often becomes the underlying logic guiding these engagements.
The EU–Azerbaijan relationship presents a compelling paradox: while geopolitically driven, it has evolved in the absence of formal political integration. Historically, Azerbaijan has never pursued a consistent Euro‑Atlantic integration agenda—its National Security Concept of 2007 identified Euro‑Atlantic integration as a strategic objective, but subsequent regional crises (e.g. the 2008 Russia–Georgia war and the 2014 Ukraine crisis) prompted Baku to shelve those ambitions. Unlike some neighbors, Azerbaijan has never made EU accession a foreign policy priority.
Yet, despite this political distance, the data paints a different picture. For over 15 years, the European Union has been Azerbaijan’s largest trading partner, accounting for approximately 52–54 percent of its total foreign trade (§2022–2023 data). By contrast, Georgia, a country with a formal Association Agreement and declared EU integration track, maintains stronger trade ties with immediate neighbors such as Russia, Turkey, and Armenia.
This contrast underscores a deeper reality: while Azerbaijan remains politically detached from the EU, it is economically embedded within the Union’s geo-economic space. This mutual dependency, rooted in trade and energy, creates a de facto partnership—despite the absence of official alignment.
And, as with all strategic dependencies, this dynamic inevitably shapes other dimensions of the relationship, including political dialogue, technical cooperation, and EU expectations around governance and reform.
Traditionally, the European Union has managed its relations with non‑member states through standard instruments such as Partnership and Cooperation Agreements or Association Agreements. However, in May 2008 Poland and Sweden jointly proposed what became the structured Eastern Partnership initiative, which was officially launched in May 2009, aimed at redefining ties with six Eastern neighbours—Armenia, Azerbaijan, Belarus, Georgia, Moldova, and Ukraine. This initiative introduced a clear integration model: countries that align more closely with EU norms and values gain deeper benefits, such as Association Agreements with privileges like visa facilitation and enhanced economic cooperation. Georgia, Moldova, and Ukraine signed such agreements; Armenia later signed a Comprehensive and Enhanced Partnership Agreement (CEPA) in 2021; Azerbaijan, by contrast, has not signed an Association Agreement or DCFTA, remaining bound only by its Partnership and Cooperation Agreement from 1999.
In fact, the last formal agreement between Azerbaijan and the EU dates back to 1999. But in a notable shift, the EU began negotiations with Azerbaijan on a completely new, tailor-made agreement—a first in EU external relations. Unlike the standard templates used with other partners, this agreement is being built from scratch, reflecting the unique nature of the relationship.
Why this special treatment? The answer lies in geopolitics. Azerbaijan is seen in Brussels not just as a neighbor, but as a strategic energy partner, and—crucially—as an alternative to Russian energy dominance. Its significance as a reliable supplier has allowed Baku to negotiate from a position of strength, shaping a relationship that goes beyond the EU’s usual frameworks.
Looking ahead, the EU–Azerbaijan relationship is poised to deepen, driven by growing mutual interdependence. Azerbaijan is entering what experts call the “gas era,” with plans to increase its annual gas exports to 50 billion cubic meters—half of which (around 25 bcm) is intended for.
The European market is increasingly looking toward Azerbaijani gas as a strategic alternative to Russian supply. A growing number of countries in Eastern and Central Europe—such as Croatia, Slovenia, and Austria—have expressed interest in Azerbaijani gas due to its potential to diversify energy sources and reduce reliance on Moscow.
Concurrently, a new geo‑economic dimension is emerging: the Middle Corridor (Trans‑Caspian International Transport Route), which connects China to Europe via Kazakhstan, the Caspian Sea, Azerbaijan, Georgia, and Turkey. Often referred to as a modern revival of the ancient Silk Road, it has gained renewed relevance following the war in Ukraine and disruptions to traditional land routes through Russia and Belarus. Despite persistent challenges—such as coordination issues, long transit times (typically 10–15 days), and higher customs costs—the Middle Corridor is increasingly regarded as a politically safer alternative to northern routes. Currently, around 90% of China–EU trade (valued at approximately €600–800 billion annually) travels by sea, while only 2–4% moves by rail, much of it through Russia and Belarus, which have become unreliable due to sanctions.
In response, many European governments and logistics firms are actively seeking to minimize reliance on Russian infrastructure. This has propelled countries along the Middle Corridor—particularly Kazakhstan, Azerbaijan, and Georgia—into the spotlight strategically. From an economic standpoint, maritime routes remain faster and cheaper, but politically, rerouting trade via the South Caucasus has become a preferred alternative.
This geopolitical recalibration prompted the EU to announce a €10 billion investment package under the Global Gateway framework for the Trans‑Caspian Transport Corridor (a.k.a. the Middle Corridor), highlighting its strategic value (European Commission press release, January 2024 – hereafter EC Global Gateway press release; further details corroborated by Qafsam and other sources).
While alternate paths through Uzbekistan, Kyrgyzstan, or Turkmenistan exist, once trade crosses the Caspian Sea, Azerbaijan remains the only viable transit route, as the only other major alternatives are Russia and Iran. In this light, Azerbaijan has emerged not only as an essential energy partner, but also as a linchpin in Europe’s evolving connectivity strategy, further solidifying its relevance in EU external relations.
In a bird’s-eye view, the European Union increasingly sees Azerbaijan as a tactical ally—an alternative to its geopolitical rivals. This perception is rooted in Azerbaijan’s strategic relevance in energy supply and emerging transport corridors. These pillars are likely to sustain and even deepen the relationship in the next 5 to 10 years.
This interdependence has already shaped the EU’s approach toward Azerbaijan in unprecedented ways—for example, launching negotiations for a completely new, customized agreement instead of applying a standard framework.