What's Happening?
Azerbaijan has increased its natural gas production by 2.4% in 2025, reaching a total of 51.5 billion cubic meters, according to the Azeri Ministry of Energy. This increase is attributed to significant contributions from the Shah Deniz field, the Azeri-Chirag-Gunashli
fields, and the Absheron field. Despite the rise in production, Azerbaijan's natural gas exports remained flat at 25.2 billion cubic meters, with a slight decrease in exports to Europe by 0.78%, totaling 12.8 billion cubic meters. The country has also signed a new agreement with Hungary to supply natural gas for the next two years, strengthening their strategic energy partnership.
Why It's Important?
The increase in Azerbaijan's natural gas production is significant as it positions the country as a key supplier to Europe, especially amid Europe's efforts to reduce dependency on Russian gas imports by 2027. The slight decline in exports to Europe could impact Azerbaijan's goal of reaching a total export target of 20 billion cubic meters per year by 2027. The new deal with Hungary highlights Azerbaijan's strategic moves to diversify its export markets and strengthen energy ties with European countries, which could have long-term implications for regional energy security and economic partnerships.
What's Next?
Azerbaijan's continued focus on increasing production and securing new export agreements suggests a strategic effort to solidify its role as a major energy supplier in the region. The country's ability to meet its export targets will be closely watched, especially as Europe seeks alternative energy sources. The new agreement with Hungary may pave the way for further collaborations with other European nations, potentially reshaping the energy landscape in the region.
