Category: Oil / Natural Gas / Green Energy

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Azerbaijani Politics Oil / Natural Gas / Green Energy

Will COP29 become a milestone in Azerbaijan’s long-term energy strategy?

COP29 çərçivəsində “SOCAR Green” və “PowerChina” şirkətləri arasında Anlaşma Memorandumu imzalanıb | Şərq qapısı

Despite its heavy reliance on fossil fuel exports for many years, Azerbaijan has now shifted its long-term energy strategy by steadily switching to renewable energy sources.

Thus, the 29th Conference of the Parties to the UN Framework Convention on Climate Change (COP29) in Baku became a vital platform for Azerbaijan’s main energy giant SOCAR and its affiliate SOCAR Green LLC (established in December 2023) to ink new agreements with countries and companies in the field of green energy, smart technologies and decarbonisation.

Focus on gas

It is noteworthy that SOCAR started supplying North Macedonia with natural gas on November 15, while Azerbaijan was hosting the major climate event on its soil. Considering that natural gas is the cleanest fossil fuel, in contrast to crude oil, Baku did not hesitate to announce the new partnership during COP29.

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Oil / Natural Gas / Green Energy

Will the renewal of the Serbia-Russia gas deal prolong Moscow’s energy dominance in Europe?

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Serbian Deputy Prime Minister Aleksandr Vulin hinted during the Eastern Economic Forum in Russian Vladivostok in September that Moscow and Belgrade need to solve issues related to the gas supply contract set to expire in 2025. Despite Western sanctions, Russia still plays a crucial role in supplying Serbia with natural gas “on time and based on very good conditions”, the Serbian minister said.

Although the continuing Russian gas supplies to Europe pose a serious dilemma within the region, some EU member countries like Hungary, Slovakia, Austria, and non-members like Serbia do not hesitate to maintain energy partnerships with Moscow.

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MENA in Turbulence Oil / Natural Gas / Green Energy

Risky Business: Saudi Arabia’s Oil Price Hike and Market Reaction

As the world’s leading energy exporter, Saudi Arabia’s decision to raise the price of oil for its Asian customers, namely China and India, is a significant development. The surprise move, announced ahead of the much-anticipated OPEC+ meeting on June 2, saw Saudi Aramco increase the price of Arab Light crude for Asia customers by over 300 percent—from $0.90 to $2.90 per barrel above the Oman-Dubai benchmark. Saudi officials cited strengthening oil benchmarks, particularly the price of Dubai-Oman crude, to justify the price hike. However, a more likely underlying motive would be Saudi Arabia’s desire to maintain high oil prices in the face of the ongoing war on Gaza and the potential for further destabilization across the Middle East, which pose a serious threat to global oil markets and the country’s economy—although the attempt to secure its own economic well-being will certainly buy it no friends to the east.

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Azerbaijani Politics Oil / Natural Gas / Green Energy

Azerbaijan’s new strategy is to become a green energy hub

COMMENT: Azerbaijan’s new strategy is to become a green energy hub

Two agreements signed at the end of May advanced Azerbaijan’s efforts to establish itself as a key energy provider in Southeast Europe, going beyond its role as a producer of hydrocarbons to enter the electricity markets in the region as well.

On May 29, Azerbaijan, Georgia, Romania and Hungary signed a memorandum to create a joint venture as part of the implementation of the Black Sea Energy Caspian-Black Sea-Europe Green Energy Corridor project. The first agreement regarding the submarine cable was signed in 2022 and it is supposed to be fully operational in 2029. The Black Sea submarine cable will be 1,195 km long and is set to be an important pillar of the transition to green energy, with the plan to integrate it into the EU’s internal electricity market. As an attempt to diversify energy supplies in response to Russia’s war in Ukraine in February 2022, the Black Sea cable is of particular importance.

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Azerbaijani Politics Oil / Natural Gas / Green Energy

Azerbaijan and Serbia Expand Defense Partnership

Presidents of Azerbaijan and Serbia made press statements

Publication: Eurasia Daily Monitor Volume: 21 Issue: 31

On February 6, Serbian President Alexander Vučić confirmed that Serbia signed a new defense contract worth over $300 million with Azerbaijan for Serbian-produced NORA B-52 (155 millimeter) self-propelled artillery (DefenseMirror.com, December 13, 2023). While Western media was surprised to hear about the new defense contract, it was not a surprise for Azerbaijani society, given the recently deepened strategic partnership between Azerbaijan and Serbia. For example, in November 2023, both countries signed a new energy deal to deliver Azerbaijani natural gas to Serbia (Balkan Insight, November 15, 2023). In the same period, Azerbaijani company AzVirt started the construction of the high-speed highway Slepcevic-Badovinci, which was 15.4 kilometers near Shabac (ABC.az, November 29, 2023). The most recent Serbian-Azerbaijani arms deal is a logical continuation of the earlier agreement regarding military-technical cooperation that consistently asserted mutual respect for each other’s territorial integrity as the framework for collaboration between the two ministries in the military-economic and military-technical sphere (The Government of Serbia, October 11, 2021).

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Oil / Natural Gas / Green Energy Russia in Caucasus

What to expect if Bulgaria expels Lukoil

COMMENT: What to expect if Bulgaria expels Lukoil

Russia’s unprovoked invasion of Ukraine in February 2022 had unpredictable repercussions in the global energy market. Although EU countries significantly decreased reliance on Russian oil and, to some extent, Russian gas, the Kremlin still maintains limited influence in some EU countries, including Bulgaria. Since the EU imposed an energy sanctions package on Russia, Bulgaria was granted a two-year exemption from Europe’s embargo on Russian oil until December 2024.

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Azerbaijani Politics Oil / Natural Gas / Green Energy

Azerbaijan’s energy diplomacy pivots to the Balkans

OPINION: Azerbaijan’s energy diplomacy pivots to the Balkans

Azerbaijan has adjusted its foreign policy agenda to target the Balkan region, that is more vulnerable to the energy crisis than the states of Central and Western Europe.

Energy has long been the core element of Azerbaijan’s pragmatic foreign policy, and recently it gained more impetus as European nations sought additional energy suppliers to replace Russian fossil fuel exports. Although the EU’s leading member countries are able to compensate for energy shortages by using energy reserves, employing alternative energy sources and importing additional gas volumes from alternative suppliers, the less developed Balkan states are struggling to adapt to the energy deficit.

More gas for the Balkans

On April 26, a signing ceremony for the memorandum of understanding on encouraging cooperation among Bulgartransgaz (Bulgaria), Transgaz (Romania), FGSZ (Hungary), Eustream (Slovakia) and the State Oil Company of the Azerbaijan Republic (SOCAR) was held in Sofia. The memorandum paves the way for additional Azeri gas volumes to flow to the Balkans amid the unprecedented energy crisis in Europe caused by Russia’s invasion of Ukraine. Moreover, the document highlighting Azerbaijan’s strategic partnership with the Balkan nations will ease the cooperation between the local authorities and the transmission and distribution system operators.

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Central Asia I China I Russia Oil / Natural Gas / Green Energy Transit Routes in Eurasia

Gas crunch emerging in East as Kazakhstan fails to meet China’s import requests

Gas crunch emerging in East as Kazakhstan fails to meet China’s import requests

The global energy crisis that is so apparent in the West is now becoming that much more visible in the East. Kazakhstan, one of the leading crude oil and gas suppliers in Asia, has announced that it intends to gradually decrease its natural gas flows to China, citing domestic consumption rising at what could become a crisis-inducing rate.

In June, Kazakh President Kassym-Jomart Tokayev ordered the government to cut gas exports and ensure that an additional 2bn cubic metres (bcm) of gas were available to consumers inside Kazakhstan. Tokayev said meeting domestic demand for gas must be held as an absolute priority over exports, with the gas to be sourced from the Tengiz field developed by a consortium led by US energy giant Chevron.

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Oil / Natural Gas / Green Energy

Amid global energy crisis Balkan states reach out to energy-rich Azerbaijan

Amid global energy crisis Balkan states reach out to energy-rich Azerbaijan

With the deepening energy crisis in the West triggered by Russia’s intervention in Ukraine, more European countries, mainly Eastern European and Balkan countries, including Bulgaria and Serbia, are eyeing alternative suppliers for additional natural gas volumes. The security cataclysms in Europe in the light of the war have pushed European countries to seek partners such as Azerbaijan.

Since 2022, Azerbaijan has held several high-level meetings with EU officials regarding exporting additional gas volumes to Europe. It is noteworthy that non-EU countries like Serbia are also keen on deepening energy partnerships with Azerbaijan. Serbia’s willingness to acquire more Azeri gas depends on the construction progress of the EU-supported Serbia-Bulgaria gas interconnector – a 171 km natural gas interconnector that will connect Nis (Serbia) and Sofia (Bulgaria), thus supporting regional energy security. According to reports, the interconnector may become operational in early 2023, giving Serbia and Bulgaria a non-Russian gas supply option. Obviously, Serbia is heavily dependent on Russian oil and gas, which have been disrupted following the Ukraine war and the imposition of sanctions on Moscow by the European Union, which Serbia is seeking to join.

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MENA in Turbulence Oil / Natural Gas / Green Energy

Algeria Makes for a Risky Partner to Help Solve Europe’s Energy Crisis

Italy signs deal with Algeria to increase gas imports | News | Al Jazeera

The war in Ukraine has exacerbated Europe’s energy crisis, leaving the European Union desperately seeking alternative sources of supply to reduce its dependence on Russian fossil fuels. Among the states in the Middle East, North Africa and Central Asia the EU has turned to in efforts to diversify its energy supplies, Algeria has been identified as a promising source of additional supplies of natural gas. But diplomatic obstacles and production limitations, as well as Algiers’ commercial links to Moscow, mean that expectations management are in order when it comes to Algeria being a cure for Europe’s energy woes.

Among the other countries that have been identified as potential alternative suppliers, including Qatar and Libya, most would not able to replace Russian natural gas exports to Europe anytime soon due to technical obstacles. Germany is in talks with Qatar for additional liquefied natural gas, or LNG, exports, but those discussions have reportedly hit a snag. Azerbaijan has also agreed to increase deliveries through available pipelines linking its fields to European markets, but there are limits to the amount of extra production it can divert.

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