Switzerland imports more oil from autocracies – is Russia behind it?

It’s a song that makes you suspicious. Switzerland imported nearly 175,000 tons of crude oil from Azerbaijan last year. The autocracy from Central Asia has thus catapulted itself to fourth place in the import statistics compiled annually by the Federal Office for Customs and Border Security. The oil is worth CHF 152 million.

Other countries such as Kazakhstan, Nigeria and the US also benefited from the fact that Switzerland imported significantly more oil after Corona. In the case of Azerbaijan, however, it is special that since 2016 the country has actually been a meaningless trader for Switzerland. The share of Azerbaijani crude oil in total imports has fluctuated between 0 and 0.1 percent for years. In 2022, this shot up to 6 percent. How did this rapid increase come about?

Fear of mines in the sea

It was originally built to reduce Russia’s influence: an approximately 1,800-kilometer long pipe connects the oil fields in Baku, Azerbaijan, via Georgia to the Mediterranean ports of Ceyhan in Turkey. The pipeline is currently of existential importance to Azerbaijan: both alternatives for European markets end in the Black Sea – where reports of floating sea mines from the Ukraine conflict are affecting trade.

Azerbaijan felt a surge in demand for oil, probably not least because the EU was considering a Russian embargo shortly after Putin’s invasion of Ukraine. In June, member states finally decided on this step, which came into force last December.

Time and time again, however, media reports cast doubts on the Azerbaijani oil miracle. While the Azerbaijani media reported rising exports, production seemed to be falling over the past year. Figures from the International Energy Agency (IEA) suggest this, among others. The latter came as no surprise: Azerbaijani oil production has been declining for years. Only with the development of new oil fields in the Caspian Sea is Azerbaijan’s main source of income expected to flow again.

Official figures are scarce

Official figures from the Azerbaijani regime are rare, and when they are, comparisons over several months or years can rarely be made. This is reported by “Eurasianet”, an independent news agency from Central Asia. To meet the increased demand, Azerbaijan imports oil from neighboring countries: Turkmenistan, Kazakhstan and Russia.

Azerbaijan, untouched by Western sanctions, has a complicated relationship with Putin. After all, Russia is Armenia’s protecting power in the Nagorno-Karabakh conflict. Lately, however, Russia has shown little will to support Armenia in its resistance to Azerbaijan’s conquests.

Azerbaijan also plays an important role for Europe. Ursula von der Leyen, President of the European Commission, signed an energy partnership with Azerbaijan last August to break its dependence on Russian gas. A few weeks later, Azerbaijan signed another gas deal with Russia.

Will this story be repeated with oil – and will Russian raw materials end up in Switzerland? The Swiss oil association Avenergy does not want to answer this question, pointing instead that imports from Azerbaijan have “shown very strong fluctuations in recent years”.

“downright perverse”

Center member of the National Council and chairman of the Swiss-Armenian Association Stefan Müller-Altermatt, on the other hand, hardly has any doubts. He says: “It is well known that Azerbaijan acts as Russia’s accomplice when it comes to gas. It is therefore not surprising that this is also done with crude oil.” What Azerbaijan is doing is “downright perverse”: “The Petro dictatorship in Baku carves favor in Brussels as a partner, but betrays this partner and then stuffs its own people with the money from Europe and attacks Armenia.”

SP party chairman Roger Nordmann, on the other hand, notes a little more cautiously: The case underlines the urgency of phasing out fossil fuels. He draws the line on the June vote, the indirect counter-proposal to the glacier initiative: “With the financial help to replace oil and gas heating, Switzerland can take a big step forward and make it more difficult for Putin to fund the war.”