US corridor reshapes regional influence in Caucasus

A US brokered peace ties Armenia and Azerbaijan closer and opens a corridor near Iran, shifting regional influence.

Iran and Russia lose from US deal with Azerbaijan and Armenia

In Washington, Azerbaijan and Armenia signed a peace framework after years of conflict over Nagorno Karabakh. A 20 mile transit corridor will connect Azerbaijan to its Nakhchivan exclave and will be operated by a US backed consortium under Armenian sovereignty for 99 years. The corridor will include roads, railways, pipelines and fibre optic lines and the White House says it will enable unhindered connectivity while respecting sovereignty. A key feature is a new level of US presence near the Iranian border, making the region strategically more open to Western influence. The deal also aims to end border disputes while expanding economic links and supporting the Middle Corridor project that links Europe to China via the region.

Iran expressed concern on the matter and warned against foreign interference. Tehran said that any regional deal should serve mutual interests and respect sovereignty. Iranian commentators described the move as a form of regional pressure on Iran. Armenia's prime minister has steered his country toward Western institutions, while Russia remains in Armenia but is coping with Europe focused conflicts elsewhere. Azerbaijan and Turkey appear ready to benefit from deeper cooperation including potential changes to rules on military cooperation with the United States. Armenia is expected to hold a constitutional referendum in 2027, a factor that could shape how the agreement plays out domestically.

The deal signals a broader turn in regional power dynamics. Washington is testing whether it can build a security and economic framework that reduces both Moscow and Tehran influence. By anchoring Armenia closer to Europe and the EU backed Middle Corridor, the pact nudges Armenia toward Western institutions while giving Azerbaijan a stable transit route to its own exclave. The arrangement places new strategic friction near Iran and could complicate Moscow’s ability to shape events in the South Caucasus. Domestic politics in both Armenia and Azerbaijan could test the agreement if constitutional changes spark opposition or if the peace process stalls. Iran faces a choice between accepting a Western backed framework at its border and risking further isolation, while Russia must weigh its pragmatic interests against a shift away from a sphere where it previously held sway. The coming months will show whether the economic promises translate into real gains and whether regional actors can sustain trust without reigniting old tensions.

Highlights

The region watches closely to see if a high level pivot can survive political tests at home and abroad.