UN Chief Seeks to Ease Azerbaijan-Armenia Tension

United Nations Secretary General Ban Ki-moon sought to ease tension between Armenia and Azerbaijan after at least 19 troops were killed in skirmishes between the two former Soviet republics in the past few days.

Ban expressed “deep concern” over the escalation and urged the countries to refrain from further violence, according to a statement on the UN website.

The skirmishes between the South Caucasus countries, which border Turkey and Iran, turned the deadliest since they signed a 1994 cease-fire. Tensions between Azerbaijan, an ally of the U.S. and Turkey and Russian-backed Armenia, flared amid the worst geopolitical standoff since the Cold War between the government in Moscow and the U.S. over the conflict in Ukraine.

“The deteriorating security conditions and the current escalation in and around Nagorno-Karabakh demonstrate once again that the world cannot accept a conflict that remains ‘frozen’ for more than 20 years,” Joao Soares, the regional representative of the Organization for Security and Cooperation in Europe, said in an e-mailed statement.

Armenia’s Eurobonds due in 2020 dropped for a fifth day, pushing the yield up 21 basis points to 5.77 percent, the highest since Feb. 25 on a closing basis, according to data compiled by Bloomberg. Azerbaijan’s dollar-denominated debt maturing in 2024 fell for a third day, sending the yield up 25 basis points to 4.89 percent, the highest since March 25.

Armenians took over Nagorno-Karabakh and seven surrounding districts from Azerbaijan in a war after the Soviet breakup in 1991. Almost 30,000 people died and more than a million were displaced before Russia brokered a cease-fire in 1994. The truce left 20,000 Armenian and Azeri troops, dug into World War I-style trenches sometimes only 100 meters (330 feet) apart, according to the Carnegie Endowment for International Peace.

Overnight Clashes

An Azeri soldier was wounded in overnight clashes, the Defense Ministry in Baku said today. At least 13 Azeri and six Armenian servicemen were confirmed killed in fighting between July 31 and August 4, the deadliest in the past 20 years.

Azerbaijan deployed tanks and heavy artillery to an area east of Nagorno-Karabakh and flew fighter jets and helicopter gunships over the line of contact separating the two armies, the Baku-based Yeni Musavat newspaper reported, citing local residents.

The Caspian Sea nation placed its artillery units near Nagorno-Karabakh on “high alert” and took aim at enemy positions along the front line and deep inside Armenian-controlled territory, the privately owned APA news service said.

BP Deal

Azerbaijan in December signed $45 billion contracts with a BP Plc-led group to pipe natural-gas to Europe starting from 2019. BP and partners have invested over $40 billion in Azerbaijan’s energy projects since 1994.

Armenian Defense Minister Seyran Ohanian, speaking to reporters in Yerevan, said that while the situation is “tense,” the resumption of a full-scale war is unlikely, according to the Armenian service of RFE/RL.

Russian President Vladimir Putin plans separate meetings with the Azeri and Armenian leaders, Ilham Aliyev and Serzh Sargsyan, in Sochi at the end of the week, Russian Foreign Minister Sergei Lavrov told Itar-Tass yesterday.

Lavrov said Russia is “alarmed” at what’s going on between Armenia and Azerbaijan and is making “considerable efforts” with its international partners to help the opposing sides reach an agreement.

To contact the reporter on this story: Zulfugar Agayev in Baku at zagayev@bloomberg.net

To contact the editors responsible for this story: Hellmuth Tromm at htromm@bloomberg.net Balazs Penz, Paul Abelsky

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