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Energy has long ceased to be a mere commodityit is the backbone of geopolitical stability. As Germany looks back on a turbulent year at the end of 2025, a quiet but massive shift has taken place behind the scenes. This is no longer about vague declarations of intent.
The reality in December 2025 is concrete: German stateowned companies have taken decisive action. Azerbaijan is no longer just a “potential” partner; it is a firmly established supplier filling the critical gaps left by the cessation of Russian deliveries. But how secure is this supply when pipelines are already operating at their limits?
The Germany Deal: Facts Over Promises
For a long time, Azerbaijani gas flowed almost exclusively to Italy. That changed in June 2025. The German stateowned company SEFE (Securing Energy for Europe) signed a 10-year contract with SOCAR. This is the “game changer” that has been the talk of energy circles.
Here are the hard numbers for your strategic planning:
- Direct Imports: Effective immediately, up to 1.5 billion cubic meters (bcm) per year flow directly to SEFE.
- Total Volume: Combined with existing contracts (e. g., Uniper), German imports from Azerbaijan now total approximately 3 bcm annually.
- Pricing: The European benchmark price (TTF) stabilized in 2025 at an average of $12.06 per MMBtu.
Expert Assessment: While 3 bcm may seem small compared to Norway’s 55% share of imports, these volumes are crucial in a tight market to cushion price spikes during the winter. It is the strategic reserve that makes the difference.
Status Quo 2025: Infrastructure at the Breaking Point
Let’s look at the physical reality. Gas cannot simply be beamed across borders; it requires steel pipes. This is exactly where the bottleneck liesa factor many analysts overlook.
The “Southern Gas Corridor” is running at full throttle. In 2024, Azerbaijan exported 12.9 bcm to Europe. For the full year 2025, an increase to 13.5 bcm is projected. The current pipelines can hardly accommodate more.
While Azerbaijan supplies gas to 14 countries (including 8-9 EU member states), Italy remains the primary buyer. From January to October 2025 alone, Rome imported nearly 7.9 bcm—accounting for over 90% of the TAP pipeline’s capacity.
The Outlook for 2026: Expansion on the Horizon
For investors and energy buyers, January 2026 is the decisive date. The TransAdriatic Pipeline (TAP) is launching its capacity expansion program. Starting in early 2026, an additional 1.2 bcm of transport capacity will become available. The long-term goal remains ambitious: doubling capacity to 20 bcm by 2027.
Turkey as an Indispensable Transit Hub
Without Turkey, not a single cubic meter of Azerbaijani gas would reach Germany. The TANAP pipeline, which runs across Anatolia, had already transported a cumulative 75 billion cubic meters by February 2025.
This geopolitical position significantly strengthens the Turkish economy, which is reflected in its economic data. To understand the stability of the supply chain, one should look at Turkey’s foreign trade indices, which show how closely the energy sector is linked to the overall trade balance.
For business professionals conducting negotiations on energy supply or logistics in Istanbul, the city has become a central hub. Many take the opportunity to combine business with high-level networkingperhaps at the best places to rent a yacht in Istanbul, where real deals are often discussed away from the conference rooms.
The Financing Challenge: Who Pays the Bill?
Now for a bit of caution to dampen the euphoria. While the EU and Azerbaijan remain committed to the goal of delivering 20 bcm annually by 2027, funding is a sticking point. Baku is calling for investments of approximately $2.9 billion to develop new fields, while Brussels is hesitant to provide long-term purchase guarantees.
While the Shah Deniz field produces reliably (approx. 20.9 bcm in the first nine months of 2025), expansion will stagnate without new capital. For companies, this means you should not expect a sudden oversupply that would drive prices down. The market remains tight.
Anyone looking to become active in the region to secure supply chains must navigate bureaucratic hurdles. An often underestimated aspect is the correct legalization of foreign documents, without which no contracts become legally binding in Baku or Ankara.
Conclusion: Strategic Diversification, Not a Panacea
Azerbaijani gas is not a 1:1 replacement for Russia for Germany, but it is an indispensable “insurance policy” in the energy mix. With the 2025 SEFE deal, Germany now has this insurance policy firmly in hand.
Keep a close eye on the news. Outlets like NTV Turkey often report on disruptions or maintenance work on the TANAP pipeline faster than Western European media. For 2026, the rule remains: infrastructure is growing, but prices stay politically driven.
