Iran’s choices in the Caucasus

The conflict in Nagorno-Karabakh has not only exposed a new balance of foreign interests in the Caucasus, but also presented Iran with a difficult choice: whether to back a Shia Muslim Azerbaijan. The prospect of Israeli access to Iran’s northern border causes concern.

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After six weeks of fighting and the capture of the strategically significant town of Shushi, Azerbaijan and Armenia agreed to a cease-fire agreement engineered by the Kremlin. Russian peacekeeping forces will help maintain the quiet, but the end of open hostilities will not solve the broader conflict. © Getty Images

In a nutshell

  • A ceasefire has frozen the Nagorno-Karabakh conflict
  • Iran fears internal agitation from its Azeri minority
  • Stronger Azeri-Israeli ties pose another threat

The latest cease-fire agreement in the war in Nagorno-Karabakh is the strongest yet, mainly because it involves Russian peacekeepers on the ground. Although not likely to result in peace, it may restore the region to its long-standing status of a “frozen conflict.” While this is nominally to the credit of the Kremlin, Moscow has few reasons to rejoice.

The recent escalation of the conflict into an open war between Azerbaijan and Armenia exposed the presence of external players with widely differing agendas, bent on rebalancing the geopolitics of the Caucasus. This poses a challenge both to Russia, which has shown a major weakness in policing its own backyard, and to Iran, which now finds itself at an ominous crossroads.

Concern about an escalation into a larger regional conflict was triggered by the forceful intervention of Turkey. By emboldening Azeri President Ilham Aliyev, Turkish President Recep Tayyip Erdogan laid down a challenge to Russian President Vladimir Putin. As Armenian forces were driven into retreat, the Kremlin’s long-standing role as regional hegemon took a serious blow.


The likely eventual outcome remains that Russia will prevail in compelling Armenia and Azerbaijan to accept a sustainable cease-fire. But on the way to that outcome, there are good reasons to watch how the new arrivals are playing out their respective agendas. While much has been said about the ambitions of President Erdogan, there is another dimension that may deserve more attention: the conflict between Iran and Israel.

At first glance, it might seem perfectly natural for Iran to back Shia Muslim Azerbaijan in a conflict against Christian Armenia. The problem for Tehran is that making such a commitment means playing with fire, in three different ways.

The first is that providing open support for Azerbaijan means being on the same side as Turkey. Meanwhile, the two have been on opposing sides in Syria. Iran and its proxies have supported the regime of Bashar al-Assad, and Turkey has provided support for rival rebel groups seeking to achieve his overthrow.

Tehran is not well prepared to face an insurrection from its Azeri minority.

Iran’s dilemma is that some of the latter have now reappeared in Nagorno Karabakh. In early October, Iranian President Hassan Rouhani noted that following years of fighting “to eradicate terrorists there so that they don’t come near our borders,” some are now “trying to bring terrorists from Syria to locations near [our] borders.” Without naming any specific country as the sponsor, he called the situation unacceptable.

Though the proliferation of Turkish proxy rebels into the Caucasus may be manageable, the second reason for Tehran to be wary of siding with Azerbaijan involves a more considerable threat. Iran is home to a sizeable minority of ethnic Azeris, and there is a risk that this community may become mobilized into demanding reunification with their brethren to the north. According to some estimates, ethnic Azeris make up a fourth of the total population of Iran, or some 20 million out of a total population of 82 million. The Armenian minority, in contrast, numbers only about 100,000. Even more significantly, Iranian Azeris number about twice the total population of Azerbaijan, at 10.3 million.

Their presence is a legacy from the early 19th century when the expanding Russian Empire forced Persia to cede the region around Baku. The creation of the Soviet Union saw the creation of Azerbaijan as a Soviet republic, and the collapse of the same union saw border posts between Iran and Azerbaijan being torn down.


Facts & figures

A map of the Nagorno-Karabakh ceasefire agreement
A Kremlin-backed cease-fire has returned the conflict to its frozen state, but not before gains by Azerbaijan. The country will regain territory captured by Armenia in 1994, keep control over newly won land, and gain access to the Nakhchivan exclave that borders Turkey. © macpixxel for GIS

Tehran has long feared that Azerbaijan may seek to annex the northern Iranian provinces of western and eastern Azerbaijan, and that the United States might support such a venture, which would drastically weaken Iran. This risk is exacerbated by the fact that the Azeri community in Iran is now being energized by what is happening in Nagorno-Karabakh. Rallies have been held featuring chants of “Death to Armenia,” and a leading pro-regime grand ayatollah, Hossein Nouri Hamedani, has claimed that “Nagorno-Karabakh is part of the Islamic world and should return to the Islamic country and must be liberated.”

Already faced with militant ethnic groups in other parts of the country, ranging from Sunni jihadists on the border with Pakistan to Kurds on the border with Iraq, Tehran is not well prepared to face an insurrection from its Azeri minority.

Closer ties

The third and most strategically important reason for Tehran to tread carefully is that a military triumph for Azerbaijan means reestablishing Azeri control over the long stretch of border that has been controlled by occupying Armenian forces since 1994. This is where the conflict between Israel and Iran enters the picture.

Although much has been made of military support provided by Turkey, the real force behind the rapid buildup of the armed forces of Azerbaijan has been Israel. According to data from the Stockholm International Peace Research Institute (SIPRI), over the decade from 2010 until 2019 Israel was the second-largest arms supplier to Azerbaijan, after Russia.

Four years ago, during a snap visit to Baku by Israeli Prime Minister Benjamin Netanyahu, President Aliyev went on record noting that Azerbaijan had purchased weapons from Israel to the tune of $5 billion. That number is presently estimated at $7 billion. According to SIPRI, a fourth of all weapons transfers to Baku in the past decade have come from Israel, including drones, guided weapons, surface-to-air missiles, anti-tank missiles and assault rifles. Such deliveries have increased dramatically over the past five years, with 60 percent of arms delivered to Azerbaijan coming from Israel.

Israeli observers note that Azeri cargo planes landing at Israeli air force bases in the Negev Desert have become a relatively common sight. Just as serious fighting was breaking out in Karabakh, no fewer than four giant Ilyushin-76 cargo planes were seen taking off from the Uvda air base in the Negev. They were operated by the Azeri cargo airline Silk Way, an entity known to serve the country’s Ministry of Defense.

Northern border

Given the nature of relations between Israel and Iran, it may seem strange that Tehran would willingly enter a coalition in which the Jewish state plays such a prominent role. This appears even more baffling considering that the ties between Israel and Azerbaijan have been about much more than an exchange of oil for arms.

The Israeli intelligence service Mossad has allegedly established a station in Azerbaijan, to serve as the “eyes, ears and a springboard” for monitoring Iran. According to credible but unconfirmed reports, Azerbaijan has also made available an idle military airfield for use by the Israeli Air Force in case of a conflict with Iran. This would not only avoid the need for in-flight refueling, but also offer a platform for the launch of search and rescue operations to recover any downed pilots.

This dynamic is where the third challenge for Tehran, in which Azerbaijan removes Armenian forces from the area along its border with Iran, becomes important. As Baku may be expected to provide Israel with access to this territory, it comes close to presenting an existential threat to Iran.

The ties between Israel and Azerbaijan have been about much more than an exchange of oil for arms.

Given the stakes involved, the rational strategy for Iran would seem to be to join Russia in seeking a refreezing of the conflict in Nagorno-Karabakh. Indeed, its initial reaction was to seek peace and mediation. On October 7, Iranian President Hassan Rouhani was still indicating that they “have very good relations with both nations,” while Deputy Foreign Minister Abbas Araghchi was sent on a diplomatic mission to Ankara, Moscow, and Baku.

But Tehran soon shifted from neutrality to open support for Azerbaijan. A milestone was October 1, when four deputies of Iranian Supreme Leader Ali Khamenei – himself of Azeri descent on his father’s side – announced that there is “no doubt” the embattled region of Nagorno-Karabakh belongs to Azerbaijan. The four represented the country’s northwestern provinces, which have a significant Azeri population.

This commitment has an important flipside. Iran has a record of trade with Armenia, whose borders with Azerbaijan and Turkey have long been closed. This trade has  comprised  gas for electricity, but possibly has also (controversially) included arms. Some media reports claim that Iran has opened its airspace to Russian cargo planes, and that Russian convoys with military equipment and weaponry for Armenia have been seen crossing at the Meghri-Norduz border point. Fuel for Armenian forces has allegedly also been coming through that juncture.

If Russia is to stand any chance of providing support to Armenia, it is essential that this route be kept open. Azerbaijan has lodged strong protests, and any rumor that such transports are continuing will provoke angry reactions from the pro-Azeri Iranians. It is a genuine dilemma, in which Tehran may be doomed to take part in a development that undermines its own security.

Moral dimension

The major unknown in this drama is Israel. While its strategic interest in siding with Azerbaijan is clear, there is also a moral side to the issue, pushed hard both by Armenia and by opposition parties in Israel. Given the fundamental importance to the Jewish state of never allowing the world to forget about the Holocaust, it is clearly uncomfortable with its own refusal to recognize as genocide the mass killings of more than 1.5 million Armenians by forces of the Ottoman Empire beginning in 1915.

Israel’s reason for siding with Turkey may again be explained by strategic interest. Starting in the late 1950s, Ankara was an ally against Syria, and subsequently against Iran. The Mossad had good relations with the Turkish MIT intelligence agency. It operated a listening post in Turkey, and the two cooperated in gathering intelligence. The Israeli defense industry also sold arms to Turkey worth nearly $10 billion.

That strategic alliance has now been dismantled by President Erdogan, who has instead strengthened ties to Qatar, Hamas and the Muslim Brotherhood, and is on record stating that Jerusalem belongs to the Muslims. This shift has caused many Israelis to question the wisdom of standing beside Turkey in denying the Armenian genocide, and the warming of relations between Israel and the Arab Gulf countries suggests that it may no longer be dependent on oil from Azerbaijan.

Iran has been weakened by U.S. sanctions, with major social problems at home.



If Israel were to flip against Turkey and scale back its support for Azerbaijan, it would have a major impact. In an October 14 interview with Asia Times, speaking on condition of anonymity, a senior source in the Israeli Ministry of Defense noted that “Azerbaijan would not be able to continue its operation at this intensity without our support.” But few believe that Jerusalem is willing to forgo the security benefits from its anti-Iran alliance with Baku.

The outlook for Iran is not a happy one. It has already been weakened by American sanctions, creating major social problems at home. Abroad, it is under pressure from the new peace deals between Israel and key Arab states, which weaken its proxies and strengthen Saudi Arabia. And the outcome of the Russia-brokered cease-fire in Nagorno-Karabakh was a clear victory for the Turkey-Azerbaijan alliance.

Both Russia and Iran are now looking at new geopolitical realities in the Caucasus. While Iran will be fearful of helping Russia to support Armenia, there is little to suggest that Israel will scale back its support for Azerbaijan. Looking forward, this not only places Russia in a defensive position, seeking to counter the growing influence of Turkey. It also places Iran in a situation in which the ever-closer links between Baku and Ankara are redrawing the map of regional energy politics.

The implication of the latter is that even if U.S. sanctions are someday lifted, it will be hard for Iran to regain its role as an energy exporter. It will have to live with the twin fears of Israel cementing its presence in the north, and of a radicalized Azeri minority demanding secession.

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