Background

Tension between Azerbaijan and Iran have reached new heights in recent days. Tit-for-tat military exercises along the Azerbaijan-Iranian border and inflammatory statements have characterized the past week between the two countries. The competing military exercises have been accompanied by harsh rhetoric by senior leaders. Iran’s Supreme Leader, Ayatollah Ali Khamenei tweeted a veiled threat in Azeri, warning “others” to “act wisely and do not allow problems in the region.”  Ayatollah Khamenei did not mention Azerbaijan by name but given the situation on the border, and that the tweet was written in Azeri, the audience of the message was clear.

There are several potential reasons for the harsh Iranian reaction in recent days, but none of them satisfactorily explain the increased military posturing: Iran has expressed outrage over the alleged Israeli presence in Azerbaijan, but the Azerbaijan-Israel relationship is well established and well documented.  Nothing in this regard has changed over the past month. Other experts have asserted that the cooperation between Azerbaijan, Turkey, and Pakistan unnerved Iran. That might be true, however discussions over trilateral cooperation and joint military exercises by the three countries have been ongoing for several years. Finally, there is the spat between Azerbaijan and Iran over Iranian truckers being taxed and detained by the Azerbaijani border service.  It remains uncertain whether any single one of these situations or a combination serves as the catalyst for this feud and the ensuing rival military exercises.

Specific Causes of Tension

Azerbaijan has a close relationship with Israel that in recent years has challenged the Baku-Tehran relationship. This is not a new partnership, and there is a history of economic ties involving gas and weapons sales between Azerbaijan and Israel. Iran has long been an adversary of Israel, and recently accused Israel of planning operations against Iran from Azerbaijan. Israel supported Azerbaijan in the Azerbaijan-Armenia conflict in 2020, which angered Iran and further complicated relations. Recently, Tehran stated that it “detected Zionist forces on the border” and claimed that Israeli operatives are working with Azerbaijani security forces.

Large military drills by Azerbaijan, Pakistan, and Turkey (the Three Brothers 2021 exercise) occurred near the Azerbaijan-Iran border. Iran likely feels threatened by closer relations among these states, because Turkey is a major competitor for regional influence. The Three Brothers 2021 military exercise had been planned for some time, but Iran’s reciprocal actions, deploying troops and equipment to the border, further increased tensions. Iran rarely puts large amounts of troops on its borders, so this latest response has caused the Azerbaijani government to ask the question, “Why now?”   

Azerbaijan placed restrictions on truck drivers from Iran who accessed routes to Armenia that cut through internationally recognized Azerbaijani territory. The overland trucking routes used by the Iranians crossed area that Azerbaijan reclaimed during the war in 2020. A heavy tax, along with Azerbaijani security forces detaining two truck drivers, strained the relationship between Baku and Tehran. Azerbaijan initially issued a note of protest about Iranian truck drivers in early August, but the problem between the two countries persists without an obvious solution in sight.  However, at its core this is a simple trade dispute that will not be resolved by military posturing and has not damaged Iran’s economy or regional prestige, nor has it enriched Azerbaijan’s treasury.  

 U. S. Responses and Policy Recommendations

1. DIPLOMATIC

After a tumultuous withdrawal from Afghanistan, the United States is likely to exercise extreme caution when engaging the principals involved in this potential border conflict. The United States needs to rely heavily on diplomatic measures in which senior leaders such as Secretary of State Antony Blinken and Deputy Secretary Wendy Sherman express vested interest on the impacts a potential conflict will have on regional states and Iran's neighbors. If the situation continues to spiral towards conflict, it will be essential for the United States to engage with United Nations partners, as well as Turkey and Israel directly. Talks with Iran would be necessary as well to encourage the country to deescalate on its side, however these discussions cannot occur directly.  Rather, the talks would most likely be held through intermediaries to avoid rewarding Iran’s bad behavior. Additionally, the United States should encourage Armenia’s leadership to keep the country neutral in the dispute and ensure its own border security with Iran. This could be assisted by efforts to formally demarcate the border between Armenia, Azerbaijan, and Iran and engage in trilateral regional commerce talks to work through complications with cargo transport and new border and customs processes.

The United States needs to engage the region on a deeper level. In recent years, the Caspian region has not been a focus of U.S. policy, but these border disputes could serve as a potential catalyst for reengagement. This process could begin by sending high-level delegations led by the Department of State, with additional interagency leaders from the Departments of Defense, Treasury, Commerce, and Justice. Visiting Azerbaijan must be the priority in order to demonstrate to Iran that its actions will have international consequences. After Azerbaijan, U.S. delegations should directly engage the states bordering the Caspian Basin that also potentially stand to be threatened by Iran and, upon completion of these engagements, subsequently visit first Turkey and then Israel.  The intent of such meetings is to open dialogue and ensure the national perspectives are known to prevent misunderstandings and miscalculations during the heightened tensions.

Additionally, Iran and Azerbaijan are not the only effected parties if conflict escalates. Europe is in a critical position as well, due to its reliance on energy from the region. The Southern Gas Corridor that begins in Azerbaijan’s part of the Caspian Sea, the proposed Transcaspian Gas Pipeline, and the Trans-Anatolian Natural Gas Pipeline (TANAP) are at risk if Iran decides to target them; this would severely impact energy deliveries to Europe as winter approaches.

2. INFORMATIONAL

In an age dominated by social media and the internet, a strategy that could prove beneficial is to increase media coverage of unfolding events.  This effort could target both Western and domestic Iranian audiences. A separate media campaign should focus on senior Iranian leaders and highlight themes like the recent riots in southwest Iran, voting issues and suppression, and the oppression of minorities.  Imagery of the Iran-Iraq war should figure prominently in the media campaign to remind Iranians of the substantial costs they incurred from that misadventure that ultimately did not result in any major victories or positive outcomes for Iran.  Putting a spotlight on internal issues could make Iran hesitant to engage in an actual border war.

3. MILITARY

The United States has a large military presence in the Persian Gulf and reinforcing U.S. Central Command’s (CENTCOM) presence there could serve as a serious deterrent. By demonstrating increased capabilities such as air defense and carrier battle groups through war games that include Azerbaijan under the aegis of U.S. European Command (EUCOM), Iran might be further dissuaded from continued escalation.  Engaging regional partners in military exercises would shore up regional security forces and provide a forum for U.S. forces to contribute meaningfully to border security and stability.

The United States could send Coast Guard personnel to assist Azerbaijani forces in developing tactics to secure energy platforms in the Caspian Sea that are potential targets of future Iranian aggression. Should more international sanctions be put on Iran as a result of the border tensions and potential conflict, the chances of Tehran targeting Azerbaijani pipelines will increase due to Iranian desperation and a desire for retribution.

Additionally, encouraging NATO to increase engagement with Azerbaijan via its Individually Tailored Partnership Plan with a focus on border and energy security would encourage Europe to take more assertive actions on the existing problems in the region.

4. ECONOMIC

The United States has the power to levy significant economic pressure on Iran as a response, most of which can be concentrated on the increased use of sanctions and prosecution of Iranian proxies and associated entities. Through interagency cooperation (specifically through the Department of Treasury and Department of Justice), new sanctions can be developed to target Iranian leaders and proxies who can be identified as involved and responsible for border escalations. This, in combination with a severe name-and-shame approach taken on by the U.S. and regional allies of individuals, companies, and countries that violate sanctions could serve as a useful approach to disincentivize Iran from potentially violating the sovereignty of neighbors due to fears of further isolation.

While the increased tension remains and Iran shows no sign of deescalating the situation, the United States should deny Iran the $10 billion financial package that they have been demanding to begin renegotiating the Joint Comprehensive Plan of Action (JCPOA).

Conclusion

The motivation behind Iran’s willingness to irrationally escalate the situation along its northern border remains somewhat of a mystery to the international community. In the calculus of international conflict, it is apparent that Iran gains nothing from a border conflict with Azerbaijan while incurring the real risk of more international sanctions and coercion. The economic repercussions could break the economy of the country, given that Iran has already been severely impacted by economic sanctions. Another border war would echo the history of the Iran-Iraq war of the 1980’s, in which Iran lost a generation to pointless conflict. Since Azerbaijan has increased its military capabilities and partnerships, conflict with Iran would have serious implications on both states' militaries, civilian populations, and critical infrastructure. Due to the complex network of regional alliances, any conflict between Azerbaijan and Iran could entangle neighboring states as well. This scenario would leave long-term and harmful impacts on the energy supplies coming out of the Caspian and on the people who live in the Caspian region and beyond.