The Hormuz crisis does not seriously affect Azerbaijan in terms of supply chains. On the contrary, our country's position as a reliable and sustainable supplier and transit corridor is strengthening.
Oxu.Az presents an article from the newspaper 'Kaspi' on the topic:
The biggest negative impact of the US-Israel and Iran war on the global economy has been the situation around the Strait of Hormuz. The paralysis of the strait, which meets a large part of the world's energy demand, led to a rapid increase in oil and gas prices. The shortage in demand has also created a wave of economic downturn and price increases in other sectors. Both energy producers and consumer states are suffering billions of dollars in losses due to this crisis. Unfortunately, it is unknown when the crisis will end.
This crisis does not seriously affect our country
Incidentally, President Ilham Aliyev also commented on the impact of the situation around the Strait of Hormuz on Azerbaijan. In an interview with Euronews, the head of state said that this crisis does not seriously affect our country in terms of supply chains. Because the policy of diversifying energy supply and routes is not a matter of today for us. This policy has been implemented for many years, and together with our partners and neighboring countries, we have managed to form a diversified supply system for oil, gas, electricity, and transport connectivity:
"Of course, events in the Middle East affect everyone to a certain extent. Some may think that high oil prices could be beneficial. Yes, that's true. But at the same time, many oil-rich countries invest their funds in bonds, and many invest in stock markets. When such instability occurs, stock markets fall. As a result, while we may earn some revenue from high oil prices, we suffer losses in our market investments. So, it affects everyone. However, in terms of our own energy projects, we are in a safe position."
Azerbaijan's experience can be useful
The head of state noted that Azerbaijan has always been an advocate of diplomacy. Without diplomacy, we would not have been able to bring our resources to markets. Because to do so, we needed to pass through the territory of other countries, build good relations with neighbors and their neighbors, create a multilateral cooperation format, and establish a win-win situation between producers, transit countries, and consumers so that everyone follows the rules and earns income:
"From this perspective, I think Azerbaijan's experience can be useful. After the crisis is resolved - which will happen sooner or later - probably a new situation will emerge. Many countries will reconsider their energy policies and ways of delivering energy resources. It is very likely that Azerbaijan's geography and existing resources will be in greater demand than today."
We are first in the world in this indicator
The results of Baku's thoughtful and far-sighted policy are also clear. Today, our country plays an important role in ensuring the energy security of Europe and other countries. Even distant Japan, which until now largely met its oil demand through the Middle East, has started to procure oil from Azerbaijan. The same picture is observed in gas exports. President Ilham Aliyev described the current situation in the same interview:
"We started cooperation with Europe in the energy sector some time ago. Especially after 2020, with the commissioning of the Southern Gas Corridor, this process has accelerated. Currently, natural gas is exported to 16 countries through this corridor. We are first in the world in terms of the number of countries supplied with gas via pipelines. This number is increasing. Ten EU member states are our customers. In total, 12 European countries buy gas from Azerbaijan. The number of countries is growing. The number of applications from countries wishing to start cooperation with us is also increasing.
Fortunately, we have completed our homework in pipeline infrastructure and production on time. Production levels are currently increasing. Soon, probably at the beginning of next month, we will announce the start of gas production from a new field. There is a mutually beneficial cooperation here. We need a premium market, and that is Europe. Europe needs an alternative supply source like Azerbaijan. Thus, we have combined our efforts and established very effective cooperation with the European Commission."
The situation will not be the same as before
As can be seen, the question of when the Hormuz crisis will be resolved remains open. Experts' assessments for the future are more pessimistic. Because even if the crisis is eliminated, neutralizing its consequences will take a long time. The crisis will require new approaches along the main arteries that make up the world's economic veins. In this situation, the example of Azerbaijan comes to the fore: both in terms of previous preparatory measures and through the diplomatic intelligence of official Baku in ensuring reliable and sustainable transit and supply.
