The Strategic Importance of the Caspian Sea
The Caspian Sea is a landlocked body of water between Europe and Asia. Five countries — Russia, Kazakhstan, Turkmenistan, Iran and Azerbaijan — border the inland sea.
The Caspian's strategic importance lies in its abundance of energy resources. The sea contains large volumes of oil and natural gas reserves both in offshore deposits and in onshore fields in the immediate region. It is estimated that the Caspian contains 48 billion barrels of oil and 8.7 trillion cubic meters of gas in proven or probable reserves.
As such, there are numerous existing oil and natural gas projects in the region, and all of the Caspian littoral states are significant energy producers. However, much of the offshore oil and natural gas resources in the Caspian Sea have not been tapped, as there are disputes between the five bordering states over where to demarcate the maritime borders and how to split up the energy resources.
Negotiations to establish maritime borders have gone on for nearly two decades. Many proposals and counterproposals have been considered, but these negotiations have not yet produced a solution agreeable to all five states.
Europe has especially been interested in the energy supplies from the Caspian. In particular, energy exploited by Azerbaijan and Turkmenistan and shipped via the strategic Southern Corridor route is seen as a way to diversify from Russia's energy grip on the continent.
But opposition from Iran and particularly Russia has prevented such moves, with both countries objecting to projects like the Trans-Caspian natural gas pipeline. This has created a tense geopolitical environment in the region, with the Caspian Sea serving as an important area of competition between Russia and the West. The recent standoff in Ukraine has only increased the importance of the Caspian Sea in this regard.