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Nazrin Abdul

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With abundant oil and gas reserves, vast renewable energy potential, and a critical geographic position connecting East and West, Azerbaijan has steadily established itself as a cornerstone of regional and global energy security. As energy geopolitics shift and supply diversification becomes a top priority for many nations, Azerbaijan’s strategic contributions are more vital than ever.

Against this backdrop, President Ilham Aliyev delivered a defining speech at the opening of three major energy events - the Caspian Oil and Gas Exhibition, the Caspian Power Exhibition, and the Baku Energy Forum - collectively forming the centerpiece of Baku Energy Week. His remarks emphasized the pivotal role of Azerbaijan’s energy sector not only in national development, but also in reshaping Eurasia’s energy map.

President Aliyev’s reflections on the country’s modern energy journey - beginning with the groundbreaking 1994 "Contract of the Century" - offered both historical context and forward-looking insight. That agreement marked Azerbaijan’s entry into the global energy market at a time of deep internal crisis, and it laid the foundation for the country’s resurgence through strategic energy diplomacy. What began as a survival strategy has since evolved into a long-term vision: leveraging energy resources to build economic independence, regional influence, and international trust.

Fast-forward to today, Azerbaijan’s energy policy remains a central driver of its economic stability. President Aliyev emphasized impressive macroeconomic indicators: oil and gas contribute over 30% to GDP, external debt remains manageable at under 7%, and financial reserves vastly exceed debt obligations. These figures reflect a prudent fiscal management approach, where revenue from hydrocarbons has been strategically leveraged to reduce poverty and invest in human capital.

What stands out is Azerbaijan’s transformation from a resource-dependent economy to a more diversified and resilient one. The investment in infrastructure, including transport corridors, positions the country as a vital Eurasian hub, not only for energy exports but also for broader economic connectivity. The Southern Gas Corridor, a monumental 3,600 km pipeline, symbolizes Azerbaijan’s geoeconomic ascent, linking Caspian resources directly to European markets and thereby reshaping the Eurasian energy map.

President Ilham Aliyev highlighted the growing footprint of Azerbaijan’s natural gas exports, which have expanded from eight countries to twelve in a short period. This geographic diversification underscores Azerbaijan’s increasing influence in global energy security. As the country negotiates further export agreements, it is carving out a leadership role in supplying reliable energy to Europe and neighboring regions, a particularly strategic development given the shifting dynamics of global energy supply chains.

This expansion is not without challenges. Maintaining the delicate balance between producers, transit countries, and consumers remains critical to avoid conflicts and ensure sustainable cooperation. Azerbaijan’s emphasis on a "win-win" approach reflects an understanding that energy diplomacy today requires careful navigation of competing interests and regional sensitivities.

Azerbaijan pivots from pipeline power to climate diplomacy

Perhaps most noteworthy is Azerbaijan’s ambitious green energy agenda. Despite being rich in oil and gas, the country is preparing to generate 6.5 gigawatts of renewable energy by 2030 - accounting for more than 35% of its total production. This dual-track strategy positions Azerbaijan as a responsible energy actor committed to diversification and environmental sustainability.

By saving several billion cubic meters of natural gas through renewable energy initiatives, Azerbaijan not only meets domestic electricity demand but also bolsters its export potential. This pragmatic approach aligns with the country’s role as the chair of COP29, where President Aliyev stressed realism over populism, advocating for an energy transition that balances fossil fuel use with green growth to avoid systemic energy crises.

Beyond national interests, Azerbaijan is carving out a role as a mediator and bridge-builder between developed and developing countries in the global climate dialogue. COP29’s achievements - including the establishment of the "Loss and Damage Fund" and operational carbon markets - highlight Azerbaijan’s capacity to host complex negotiations and foster consensus.

President Aliyev’s call to build trust between the Global North and South and to support vulnerable states underscores Azerbaijan’s emerging identity as a responsible and pragmatic energy leader, not just a resource supplier. This diplomatic positioning enhances its soft power and aligns energy cooperation with broader goals of sustainable development and climate justice.

President Ilham Aliyev’s speech at the opening of Baku Energy Week reflects a mature, multi-faceted energy strategy. It recognizes the enduring importance of oil and gas as pillars of economic strength and geopolitical influence while embracing renewable energy and global climate responsibilities. Azerbaijan’s energy policy demonstrates how a resource-rich country can navigate the complexities of modern energy challenges by balancing legacy assets with innovation, economic pragmatism with environmental stewardship, and national interests with international cooperation.

In an era of global energy uncertainty, Azerbaijan’s balanced and forward-looking approach not only secures its own future but also contributes meaningfully to regional stability and global energy security.