[BRIEF ANALYSIS]: Armenia/Azerbaijan – more geopolitics to add to the mix

Analysis details (08:53)

LATEST: Clashes have been reported once again at the Azeri/Armenian border that left an unknown number of casualties. A ceasefire was reported to have been reached, and then breached shortly after. There were also reported that Armenia has officially called on Russia to activate the Treaty of Friendship and Cooperation, which includes mutual defence, according to Al Jazeera citing Armenian media. Armenian PM said 49 Armenian soldiers are dead as a result of fighting along the border with Azerbaijan - a large number of casualties when compared to prior clashes.

BACKGROUND: Hostilities between Armenia and Azerbaijan over the disputed territory of Nagorno-Karabakh have been ongoing for decades. After the 2020 Nagorno-Karabakh war, Russia brokered a ceasefire deal between the two sides last year, although this has been tested several times since. The deal broked by Moscow required Armenia to renounce its military control over the region and allowed Russian peacekeepers to guard the area for five years. A brief history and timeline of events can be found here.

WIDER IMPLICATIONS: At this point, given the myriad of themes around the markets, it is difficult to envisage an immediate impact on assets. However, it is worth remembering in the context of the Russia-Ukraine war, Armenia is pro-Moscow and, since 2014, supported Russia’s annexation of Crimea, whilst Russia has been expanding military bases in Armenia. The US established diplomatic relations with Azerbaijan in 1992, following its independence from the Soviet Union, according to the US State Department. Meanwhile, reports suggest that “public sentiment in Azerbaijan supports Ukraine and Ukrainians supported Azerbaijan’s liberation of occupied territories during the 2020 Second Karabakh War.” Elsewhere, Turkey is considered to be Azerbaijan’s main supporter, with Ankara also acting as a mediator in Russia-Ukraine relations – e.g. the grain deal. Neighbour Iran meanwhile has officially taken a neutral stance and has, in the past, been playing the role of a mediator between Azerbaijan and Armenia.

13 Sep 2022 - 08:55- Geopolitical- Source: Newsquawk