Azerbaijan's Moment: Europe Diversifies Energy Partnerships Amid Hormuz Crisis

The Hormuz crisis has highlighted Europe's reliance on global energy trade routes and the importance of diversifying its energy partnerships. For decades, Russia was the dominant supplier of natural gas to the EU, but the invasion of Ukraine in 2022 exposed the risks of dependence on a single provider.

European leaders responded by increasing their engagement with alternative suppliers like Azerbaijan, which has become a key player in Europe's long-term approach to energy diversification. The Trans Adriatic Pipeline (TAP) is a major infrastructure project that transports natural gas from Azerbaijan's Shah Deniz field directly to Europe, reducing dependence on Russian supplies.

Azerbaijan's relationship with Europe dates back to 1999, but it was the invasion of Ukraine that accelerated their partnership. Today, the EU is Azerbaijan's largest trading partner and primary export market, accounting for nearly 39 percent of the country's total trade and over 70 percent of its exports.

During high-level meetings in Baku, European and Azerbaijani officials emphasized the strategic importance of their energy partnership and committed to deeper cooperation on energy security. A preliminary agreement was reached on the EU-Azerbaijan Partnership Priorities for 2026-2030, which outlines future cooperation across areas such as energy, trade, and regional connectivity.

While Azerbaijan's gas exports to the EU grew by only 3 percent in the first half of 2026, Europe managed to avoid widespread natural gas shortages during the Hormuz disruption. However, the crisis did drive up energy prices, increasing the collective gas bill for the EU's 27 member states by an estimated 48 percent.