An emboldened Azerbaijan, backed by Turkey, has changed the balance of power in the South Caucasus in recent years.

Baku reclaimed full control over Nagorno-Karabakh, a breakaway region that for three decades had been under ethnic-Armenian control, last year.

A weakened Armenia, meanwhile, has distanced itself from its traditional ally, Russia, and looked to move closer to the West.

The geopolitical changes in the region have raised concerns in Iran, which neighbors Armenia and Azerbaijan. Tehran fears it could lose its clout in a region that has long been dominated by Moscow, an ally.

The Islamic republic strongly opposes the proposed east-west Zangezur Corridor that would connect mainland Azerbaijan to its Naxcivan exclave through Armenian territory and open a long-sought trade route to Tehran’s rival, Turkey, and beyond.

Iran is also concerned Baku could forcibly seize territory in southern Armenia to create territorial continuity with Naxcivan, which would cut off Tehran from Yerevan, an ally.

Iran also opposes normalization between Armenia and Turkey, a scenario that could reduce Yerevan’s dependence on Tehran and pave the way for greater Western influence in the volatile region.

“The changing dynamics in the region and the decline of Russia’s relative influence pose potential challenges to Iran’s long-term geopolitical and security goals in the region,” said Hamidreza Azizi, a fellow at the German Institute for International and Security Affairs.

Cutting Iran Out

The top diplomats of Armenia and Turkey met on March 1 in the Turkish coastal city of Antalya and reiterated their nations’ intention to fully normalize relations.

That meeting was viewed with apprehension by some pundits inside Iran who suggested such a move would cut Tehran out of the region.

“If Ankara’s efforts to normalize relations with Yerevan are successful, leading to the establishment of the Zangezur Corridor, it could indeed marginalize Iran geopolitically,” Azizi said.

The 45-kilometer-long proposed corridor, Azizi said, would “not only enhance Turkish and Azerbaijani influence by providing a direct link between the two but also bypass Iran, diminishing its role as a potential regional transit hub.”

Eldar Mamedov, a Brussels-based expert on the South Caucasus, said the corridor would effectively leave Iran “excessively dependent on the goodwill of Ankara and Baku for the security of its northern borders and also for accessing transit routes [to Russia].”

Azerbaijan’s increasingly cozy relations with Iran’s archfoe, Israel, have fueled tensions with Tehran.

Iran is also wary that Baku’s growing influence in the region could fuel “irredentist tendencies” among Iran’s large ethnic Azeri population, separated from Azerbaijan by the Aras River and located primarily in Iran’s East and West Azerbaijan provinces, Mamedov said.

For Armenia and Turkey to normalize relations, Yerevan and Baku first need to sign a peace agreement, according to Benyamin Poghosyan, a senior research fellow at the Applied Policy Research Institute of Armenia.

Poghosyan said Azerbaijan would only sign the deal if Armenia conceded to all of Baku’s demands, including the establishment of the Zangezur Corridor.

“But I don’t believe Armenia will agree to provide Azerbaijan [with an] extraterritorial corridor,” he said.

Poghosyan added that Azerbaijan is unlikely to forcibly seize Armenian territory to establish the corridor given the presence of a “hard-power deterrent” like Iran.

Wary of The West?

In February, Armenia suspended its membership in the Russian-led Collective Security Treaty Organization (CSTO).

The government of Prime Minister Nikol Pashinian has long criticized the CSTO for its “failure to respond to the security challenges” facing Armenia.

In 2020, Baku recaptured parts of Nagorno-Karabakh, a mainly ethnic-Armenian-populated region inside Azerbaijan, following a six-week war that ended with a Russian-brokered cease-fire.

In September 2023, Azerbaijan retook the rest of the territory after a lightning offensive that resulted in the full capitulation of the de facto Karabakh government.

Armenian authorities have accused Russian peacekeepers deployed to Nagorno-Karabakh after the 2020 war of failing to stop Azerbaijan’s offensive last year, a claim rejected by Moscow.

Armenia on March 6 said it had requested Moscow to remove Russian border troops from the international airport in Yerevan, the latest sign of souring relations.

The moves have fueled concerns in Iran that Armenia could turn to the West to guarantee its security.

In an apparent warning, Iranian Defense Minister Amir Ashtiani on March 6 told his Armenian counterpart in Tehran that “looking for security outside the region will have the opposite effect.”

“We believe that the security architecture of the region should be designed in the region; therefore, any approach by countries in the region against this policy would be in no way acceptable,” Ashtiani warned Suren Papikyan.

Poghosyan said Armenia seeks to “diversify its foreign and security policy” but that it was too soon to tell whether it wants to completely pivot to the West or just strengthen relations with Western powers without abandoning Russia.

He added that Iran has made it clear to Armenia that it “would not tolerate geopolitical changes in the South Caucasus, which means not only changes [to] borders, but also changes [to the] balance of power in the region.”

For all their differences, Iranian and Western interests converge on their support for Armenian sovereignty.

As such, Mamedov argued, Iran’s opposition to a Western presence “may not be as rigid as it appears to be in the official rhetoric.”

But it is unclear if that will lead to any collaboration.

“The overarching anti-Western stance in Iranian foreign policy and Tehran’s presumed desire not to upset Moscow in the South Caucasus make such cooperation very unlikely,” Azizi said.