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With all of its existing energy export routes now back under Russian control, Azerbaijan may be forced to come to an accommodation with Moscow. (With Stratfor map)

Azerbaijan is losing some $50 million to $70 million per day due to the closure of the Baku-Tbilisi-Ceyhan (BTC) oil pipeline, the Caspian Energy Alliance said Aug. 14, adding that Baku’s total losses from the closure amounted to some $500 million. The 1 million barrel per day (bpd) BTC line, which passes from Azerbaijan to Turkey via Georgia, was shut down Aug. 6 following an attack on the Turkish part of the line, claimed by a Kurdish separatist group. If not for that attack, however, it might well have been shut down anyway amid the military conflict in Georgia that began two days later.

Azerbaijan exports oil and natural gas to Western energy markets via three pipelines — all of which pass through Georgia, and all of which experienced cutoffs in the past several days. Two
of them — the BTC and the 150,000 bpd Baku-Supsa — carry oil. The Baku-Tbilisi-Erzurum line carries natural gas at 9 billion cubic meters per year. The pipelines were built to provide a transport route for Caspian Sea energy to reach Western markets without having to pass through Russia, which controls the majority of pipeline infrastructure into Europe. Now that Russia has established a firm military presence in Georgia, however, it is highly likely that all three lines will continue to operate, or not, at the pleasure of the Kremlin.