Preventing armed conflict in the Caspian Sea


An interstate conflict between Iran and Azerbaijan was prevented and the risk of war between any of the littoral states on the Caspian Sea was demonstrably reduced.

The Caspian Sea is a resource-rich body of inland water. Since 1994, when the Government of Azerbaijan signed the “contract of the century” with Western oil companies to exploit offshore oil fields, the five littoral states (Azerbaijan, Iran, Kazakhstan, Russia, and Turkmenistan) have issued competing territorial claims over much of the Sea. After years of diplomatic disputes, tensions came to a head in July 2001 when two BP geological survey ships working with the Azerbaijani government ventured into the Alov oilfield, which was claimed by Iran.1 Iranian naval and aviation assets forced the ship back (without violence), before conducting some limited attacks on Azerbaijani marine boundary buoys and conducting sorties in Azerbaijani airspace. In response, the Azerbaijani military mobilised for war and the Government of Turkey, a close ally of Azerbaijan (and member of NATO) dispatched a contingent of its Air Force to Baku.2 A bilateral summit held in September 2001 served to resolve the immediate crisis (which became known as the Alov Crisis) and prevent an armed conflict from erupting between Azerbaijan and Iran, but the issue of contested territory remained. In the aftermath of the dispute, Azerbaijan invested heavily in strengthening its military capacity with support from the governments of Israel and the USA. In 2003, these new capabilities were demonstrated in the Caspian Sea during exercises involving 1,200 marines and a range of ships, boats, and helicopters.3 The Iranian government, for its part, also strengthened its military assets in the Sea along with every other littoral state.4 Although war was avoided in 2001, there remained a severe risk of interstate conflict in the Caspian Sea following the Alov Crisis.5

The first Caspian Sea Littoral States Summit was held in 2002 in the wake of the Alov Crisis with the express intention of resolving the various territorial disputes and preventing armed conflict in the region. Although a final agreement on the status of the “inland water basin” was not reached until the fifth summit in 2018, this painstaking negotiation process served as an effective mechanism for minimising the chance of war and developing a lasting peace in the region. The final agreement represented a compromise, dividing the seabed between the littoral states while maintaining the surface as international waters.6 Upon signing the 2018 agreement in Ataku, Kazakhstan, the leaders of all five littoral states declared the region to be a sea of peace and good neighbourliness.

1 Shannon O’Lear. “Resources and Conflict in the Caspian Sea.” Geopolitics, Vol. 9, No. 1. (2004) p.161

2 Musa Qasimli. “Caspian Sea Dispute.” in Ali Askerov et al, eds. Post-Soviet Conflicts: The Thirty Years’ Crisis. (Rowman & Littlefield: Lanham, 2020) pp.247-8

3 Anar M. Valiyev. “Azerbaijan-Iran Relations: Quo Vadis, Baku?” PONARS Eurasia Policy Memo, No. 244. (2012) p.4

4 O’Lear. “Resources and Conflict in the Caspian Sea.” pp.177-8

5 Nicola Contessi. “Traditional Security in Eurasia: The Caspian Caught Between Militarisation and Diplomacy.” The RUSI Journal, Vol. 160, No. 2. (2015) pp.50-1

6 International Institute for Strategic Studies. “The Caspian Sea Treaty.” Strategic Comments, Vol. 24, No. 9. (2018) p.i

Start Year


End Year



Caspian Sea

UN Regional Group

Eastern Europe

Type of Conflict

Risk of an interstate conflict

Type of Initiative

Diplomacy, Resolution of a militarised territorial dispute

Main Implementing Organisation(s)

The governments of Caspian Sea littoral states




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