Azerbaijan State Oil Company (SOCAR) is caught in the midst of Israel-Gaza war

Image by Arzu Geybullayeva

On May 31, an activist group named “The Thousand Youths for Palestinegathered outside of the Azerbaijan State Oil Company (SOCAR) building in Istanbul to protest the country's steady oil supply to Israel via the Baku-Tbilisi-Ceyhan (BTC) pipeline — a gas pipeline that carries Azerbaijani oil through Georgia to Turkey's Mediterranean ports from where it is shipped around the world, including Israel. Turkey continues to maintain the flow despite calls to halt the supply of Azerbaijani oil exports to Israel (Turkey did restrict the sale of certain goods to Israel in April and announced its decision to cease all trade ties with Israel in May 2024).

According to reports by local media, some 13 members of the group were arrested after staging a protest, throwing red paint on the walls of the entrance to the building, and breaking the entrance door. While initially silent on the incident, SOCAR eventually responded, denying the direct sale of oil to Israel and asserting that the sale takes place via trading companies. SOCAR insisted these trading companies are not monitored or controlled by supplying companies like SOCAR.

An Azerbaijan State News Agency, APA, even claimed “the protest was a result of Iranian sabotage, trying to tarnish Azerbaijan's image in Turkey.” Meanwhile, SOCAR's Turkish media platform Haber Global claimed the goal of the recent targeting of the SOCAR building in Istanbul was to damage relations between Turkey's President Recep Tayyip Erdoğan and Azerbaijan's President Ilham Aliyev.

Ties between Israel and Azerbaijan

Azerbaijan's ties with Israel have long been based on trade in military and surveillance equipment, oil supply, and more recently aerospace technology. Israel set up its embassy in the capital Baku in 1993. Azerbaijan started supplying Israel with oil in 1999. The turning point in relations however came in 2010 according to Azerbaijani analyst Zaur Shiriyev who told Global Voices in an interview that Baku's need to modernize its military and Israel's search for new partners amid deteriorating ties with Turkey could bring both countries closer.

By 2011, Azerbaijan was ranked Israel's top trade partner and was exporting some 2.5 million tons of oil per year, according to available data during that time. The same year, Azerbaijan State Oil Company (SOCAR) subsidiary, the Caspian Drilling Company, signed a deal with Israel's oil field Med Ashdod, gaining a five percent stake and the rights for offshore drilling in the area.

As relations flourished, Azerbaijan upped its spending in Israeli military equipment. Between 2015–2019, Israel supplied 60 percent of arms imports to Azerbaijan, according to data by the Stockholm International Peace Research Institute. This equipment as well as the purchase of Israeli drones, helped Azerbaijan secure victory during the 44-day war with Armenia in 2020.

Azerbaijan continued to maintain a delicate balance in the wake of Hamas’ October 7 assault on Israel and the subsequent war in Gaza. Officially the country has not condemned Israel. The only action it has taken thus far was to “vote in favor of the UN General Assembly resolution calling for an immediate humanitarian truce leading to the cessation of hostilities between Israel and Hamas,” which according to foreign policy expert Eldar Mamedov “is about as far as [Azerbaijan] is prepared to go,” in his opinion piece for Eurasianet in November 2023.

Addressing journalists following the meeting with Egyptian counterpart President Abdel Fattah al-Sisi in Cairo on June 8, President Aliyev also called for the “tragedy in Gaza” to stop and to resolve all issues through negotiations.

In an interview with Voice of America Azerbaijan Service, one Azerbaijani member of the parliament Rasim Musabeyli, expressed solidarity with Israel shortly after the October 7 attack, saying, “We strongly condemn the attacks that have resulted in the deaths and injuries of a large number of civilians. In these difficult times, we stand with Israel.”

In October 2023, SOCAR was among six companies awarded a license to explore and develop new natural gas reserves in the Eastern Mediterranean. “The winning companies have committed to unprecedented investment in natural gas exploration over the next three years, which would hopefully result in the discovery of new natural gas reservoirs,” Energy Minister Israel Katz reportedly said at the time.

The same year, Azerbaijan opened its embassy in Tel Aviv.

At present, Azerbaijan supplies approximately 40 percent of Israel's oil via the BTC pipeline and there seems to be potential for growth. In April 2024, Ministers of Energy from both countries discussed further energy ties during a meeting in Dubai.

Turkey's balancing act

Then there is Turkey which has gone from trying to mediate between Israel and Hamas since October 2023 to announcing total restrictions on all trade with Israel until the war on Gaza ends. But a recent investigation by Turkish journalist Metin Cihan showed how Azerbaijani oil continued to flow via the BTC to Israel aggravated existing grievances. Using data from BOTAS — Turkey's state-owned oil and gas company which operates Turkey's section of the BTC — Cihan wrote how millions of barrels of oil are shipped from Ceyhan on a monthly basis. “We don't know how much of it goes to Israel,” wrote Cihan on X. “According to our Minister of Energy, we do not have influence nor authority over where oil is shipped. The oil is sold by Azerbaijan. We simply get our share,” explained Cihan.

In his following tweets, Cihan wrote that after looking into relevant agreements, Turkey cannot sanction this trade route given the existing agreements. “According to an agreement with British Petroleum (BP) we would pay compensation to the company in case of a delay of petroleum for any given reason,” explained Cihan. “According to the Baku – Tbilisi – Ceyhan pipeline agreement [Turkey] signed we are obligated to continue supply oil even at times of war or terrorism. This trade is considered superior even to human rights and state sovereignty. In exchange, we receive a share of 80cents per barrel of oil loaded onto tankers from Ceyhan,” added Cihan.

Back in Baku, the relations with Israel continue. According to Azerbaijani analyst Rovhsan Mammadli Azerbaijan is “inclined to quietly enhance its relations with Israel without getting entangled in the games of major powers” even though “the potential costs or benefits of alignment with Israel” are difficult to predict as the war on Gaza continues.

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