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Relations between Armenia and Azerbaijan have been influenced and the
conflict might also have an impact on the Nagorno-Karabakh conflict. Arme-
nia was left with no military ground transit from Russia, and the country is
now essentially cut off from any possibility of obtaining effective help from its
ally and has decided to respond quickly to Turkey’s proposal to normalize re-
lations and open the border. The very idea that Turkey would go through with
the border talks without attaching any conditions on Karabakh has provoked
anger in Azerbaijan, especially since Turkey sealed the border in 1993 in re-
sponse to the Armenian occupation of the regions, a reality which has clearly
not changed. 
Due to this delicate issues significant challenge for regional security is-
sues is ongoing Armenian-Turkish rapprochement, which could considerably
change security environment in South Caucasus. On October 10,2009 the For-
eign Ministers of Turkey and Armenia met in Zurich and signed accords aimed
at establishing diplomatic relations and opening their closed border. They
also agreed to a series of consultations and confidence-building measures to
resolve longstanding disputes and foster closer cooperation. These protocols
still need to be ratified in Ankara and Yerevan, and implementation is very
far from certain. But these new accords - finalized after some critical last-
minute diplomacy by U.S. Secretary of State Hillary Clinton - could prove
transforming for regional stability around the South Caucasus and beyond.
Geopolitical interest of Regional players and balance of Power
The European Union has long sought alternate supply routes, including
the prospective Nabucco pipeline that would carry Caspian and Central Asian
gas to Europe but skirt Russia. The EU also risks continued energy depend-
ency on Russia and a sharp rise in natural gas prices unless it backs alterna-
tive non-Russian projects similar to White Stream. The White Stream Pipeline
aims to bring Caspian gas through Azerbaijan and Georgia and across the
Black Sea to Ukraine and Romania, from where it will travel farther into Eu-
rope. The pipeline would reduce the impact on the EU of any future Russian
gas cut-offs and complicate Russian plans to put gas prices on a higher footing
for the long-term. 
Having seen that BTC (Baku-Tbilisi-Cheihan) and BTE (Baku-Tbilisi-
Errzurum) are aiding its efforts toward energy diversification, the European
Union representatives are debating various new energy-import projects. This
in turn is leading potential supplier and transit countries to line up to get in
on what promise to be very lucrative deals (Pannier, 2009 ). But by diversifi-
cation, Europe also means finding routes that do not go through Russia. 
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Caucasus Journal of Social Sciences

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In order to meet this challenge this summer (2009), EU backed consor-
tium of energy companies from Turkey, Bulgaria, Romania, Hungary, and Aus-
tria that have joined together to build the $11 billion Nabucco natural gas
pipeline.  Such an energy strategy, pundits say, is urgently needed to stop
Moscow’s “divide-and-conquer politics.” Nabucco would bring gas from Mid-
dle Eastern and Caspian fields across Turkey’s Anatolian plateau, and north
into Europe. The pipeline is backed and partly funded by the EU and is
strongly supported by the United States. Perhaps most importantly, Nabucco
would completely bypass Russia. But the real question that will determine
Nabucco’s future — a question vividly on display in every country the pipeline
will touch — is whether Europe has the stomach to fight as hard for its inter-
ests as Russia does for its own (Freifeld, 2009).
However, Russia’s aggressive behavior versus Russia’s neighbors and
outright aggression against Georgia, that led to effective annexation of two
Georgian territories- Abkhazia and South Ossetia, creation of the Russian mil-
itary bases and deployment of regular Russian forces makes the role and se-
curity of current or future pipelines running through that country an issue
that weighs heavily on the minds of many in the EU. 
Similarly, whilst Russia sees the economic value of the energy security is-
sues, this is secondary to its geopolitical value as a means of maintaining con-
trol over it’s so called “near abroad” and ensuring only nominal independence
for the countries of the region. This policy is most clearly evidenced in their
intervention in the internal affairs of these countries. Moreover, Russia seems
unable to control the political development in the region and has moved to
dominate region including through military means.  
Though officially Russia does not object to the construction of the
Nabucco gas pipeline and as Russian Prime Minister Vladimir Putin said after
the signing of South Stream documents with European partners “will not cre-
ate any impediments”, it has attempted to block alternative energy routes
other then its own encouraging crisis between Azerbaijan and Armenia over
Nagorno Karabakh and destabilizing and publicly invading Georgia. Moreover,
like Iran Russia envisages resources of the Caspian Sea into the energy hub of
non-Western energy zone (Sinker, 2001. p. 54).
Moscow has sought to gain control of the energy transport and distribu-
tion networks in neighboring states for long-term economic gain and leverage
over their policies, and to ensure that the energy producers among them ex-
port through Russia.  Russia has also aggressively pursued blocking potential
natural gas export competitors from entering the European market, such as
Iran, Azerbaijan and producers in Central Asia, and works assertively to retain
control over Central Asian export.  Iran is the only country that has the vol-
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Caucasus Journal of Social Sciences

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