Azerbaijan is expected to start up the $40-billion Southern Gas Corridor soon that will bring gas from the country’s giant Shah Deniz II field to Europe through Turkey. The pipeline is supported by the European Commission as it tries to reduce Russia’s dominance in Europe’s energy market. Additional Azeri supplies are expected to squeeze Russia’s gas sales to Europe and Russia, heating up both countries’ relationships which already strained over the Nagorno-Karabakh conflict.
Azerbaijan ships nearly 7 bcm a year of gas to Turkey via the existing TANAP pipeline. The new pipeline will add exports to Turkey by 6 Bcm, while 10 Bcm is earmarked for Europe. Turkey and Azerbaijan share similar cultural backgrounds and have close relationships, with Ankara supporting Baku on the Nagorno-Karabakh conflict.
On the other hand, Russia’s gas exports to Turkey declined by more than 40%, to 4.7 Bcm. Russia’s natural gas exports fell to $11.44 billion in the January-June period of 2020, declining from $18.65 billion a year earlier, according to the country’s central bank. Azeri gas will unlikely replace all Gazprom’s supplies to Europe. However, it will be significant enough to heat up the rivalry.
