In mid-March, Armenia and Azerbaijan announced they had finalized the text of a long-anticipated peace agreement, which, if signed, marks a potential end to more than three decades of conflict. Yet the signing remains elusive.
As a prerequisite for signing the deal, Azerbaijan is insisting on changes to Armenia’s constitution to remove language it sees as implying territorial claims. It also wants a guarantee of unimpeded overland access to its Nakhchivan exclave, a landlocked territory bordered by Armenia, Iran, and Türkiye, and separated from the rest of Azerbaijan by Armenian territory. Access to Nakhchivan is closely tied to Baku’s broader aim of reopening regional transport links, including with Armenia and Türkiye, its close ally, though Ankara has not publicly endorsed such a linkage. Finally, Azerbaijan has called for the formal dissolution of the long-defunct OSCE Minsk Group, once the main mediation platform between the two countries. That demand is considered relatively uncontroversial and likely to be accepted. Though not unsurmountable, these unresolved issues risk stalling the fragile momentum.
The origins of this process lie not in the aftermath of the 2020 war between Azerbaijan and Armenia—in which Baku regained most of the territories it had lost in the 1990s, and Russia introduced peacekeepers, gaining a monopoly over mediation between the two sides—but in the fallout from Russia’s full-scale invasion of Ukraine in 2022. Only amid Moscow’s distraction and weakening regional grip did serious negotiations begin. Talks resumed based on a framework initially proposed by Baku in 2021, which Yerevan did not respond to or engage with at the time. The resurrection of talks reflected not only new military realities but a broader recalibration of power across the South Caucasus, as Russia—preoccupied with occupying its neighbor and increasingly weakened—lost its grip on the region, prompting Armenia to reassess its strategic orientation. In this shifting landscape, Armenia accelerated efforts to diversify its foreign policy beyond Moscow, while Azerbaijan positioned itself as a strategic energy partner to Europe—though the partnership has delivered mixed results and unfolded alongside growing political tensions with Brussels.
Baku, sensing an opening after Russia’s invasion of Ukraine, moved swiftly to consolidate its military and diplomatic gains. In 2023, it regained full control over Nagorno-Karabakh, a region within its internationally recognized borders, and compelled the withdrawal of Russian peacekeepers a year before their mandate was due to expire. This outcome was unthinkable just a few years earlier. Baku also advanced its role in regional trade and energy corridors and deepened partnerships with Türkiye and the EU. Moscow viewed these moves warily. Rather than welcoming peace, it saw the process as a challenge to the monopoly it had reasserted after 2020, undermining the system of managed instability it had long used to exert control.
Azerbaijan’s confidence is now on display. When a Russian missile mistakenly downed an Azerbaijani civilian aircraft last December, Baku’s response was swift and public—unthinkable not long ago. Unlike other post-Soviet states, Azerbaijan is not a member of the Russia-led Collective Security Treaty Organization or the Eurasian Economic Union, and its economy operates largely outside Kremlin influence. That autonomy has enabled Baku to pursue a more assertive foreign policy.
Yet Russia has not exited the scene. As Baku and Yerevan inch toward normalization, Moscow may seek to play spoiler. It might argue that, absent a signed agreement, the foundation of their relations remains the defunct 2020 ceasefire and its 2021 auxiliary protocols, signed under Russian patronage. Only a new, jointly ratified peace accord can displace Moscow’s claim to that role. Russia could point to the ceasefire’s vague language on transit route monitoring—including the route to Nakhchivan—as a pretext to argue that connectivity can only be resolved through its involvement. Yet under the finalized peace agreement, both sides have agreed not to allow third-party forces along their mutual border—a principle that should apply to Russia as well.
The controversy around connectivity illustrates how unresolved bilateral issues—alongside constitutional reform—continue to complicate the path to a final peace. Responsibility for resolving them rests with both sides.
First, on constitutional reform, the Armenian government has signaled its intent to draft a new constitution, though it is unlikely to do so before parliamentary elections in 2026. Trying to force the issue without a signed agreement could trigger backlash and undermine the broader peace process. Framing the reform as a bilateral confidence-building measure, rather than a unilateral Azerbaijani demand, could give Yerevan the political space it needs.
Second, the issue of connectivity to Nakhchivan remains highly politicized and burdened by mutual distrust. On their own, Baku and Yerevan may lack the flexibility or political space to resolve it. Brussels helped facilitate earlier rounds of negotiation and, despite some skepticism from Baku, still retains enough credibility to play a constructive role. Renewed EU engagement could help depoliticize the issue, introduce creative solutions, and unlock international support for long-term connectivity.
The stakes extend well beyond Armenia and Azerbaijan. A signed peace deal would reshape the regional order. Türkiye, which sees the South Caucasus as part of its strategic hinterland, has tied the reopening of its border with Armenia to progress in Baku-Yerevan talks. For Armenia, that opening offers not just symbolic value but a vital economic and geopolitical alternative to reliance on Russia.
But the window is narrowing. If no agreement is signed by year’s end, the momentum built since 2022 could collapse. Armenia’s domestic fragility, a distracted international environment, and the prospect of renewed Russian pressure all threaten the process. A U.S.-Russia settlement over Ukraine—especially one that sidelines Kyiv—could free Moscow to reassert itself in the South Caucasus. More than that, it could tacitly affirm Russia’s claim to a sphere of influence in the region, which Azerbaijan has actively challenged since 2020. Rather than being sidelined, Russia may seize the moment to reclaim the dominance it lost after 2022.
Russia’s hegemonic moment in the South Caucasus has passed, but it retains the ability to spoil. That influence, however, is not entirely self-made. It has been sustained by both sides’ past tendencies to selectively invoke agreements and mediation frameworks to suit their political needs. This diplomatic forum-shopping has kept Moscow relevant before and could do so again, especially in the absence of a final peace deal. The choice for Armenia and Azerbaijan is whether to deal with Russia while its influence is diminished or to wait until it is emboldened. Better to strike a deal now, on their own terms, than risk ceding control to a process driven by Russia’s agenda.
Both Armenia and Azerbaijan now stand at a strategic crossroads—but it is Azerbaijan that holds the stronger position. It aspires to be a regional power, yet that status depends on more than battlefield gains or favorable timing. The opportunity created by Russia’s distraction will not last. Without peace, Baku risks mistaking short-term leverage for lasting influence. With an agreement, Azerbaijan could consolidate its leadership and help shape a more stable regional order less dependent on Russian oversight. Without one, its recent gains—and the region’s future—could remain uncertain.
