Diversification Without Illusions: What the Turkic World Can Offer Europe on Energy - Türkiye

The role of the Turkic countries is increasingly valued in our world full of turmoils and insuperable interdependencies. Media outlets have been overwhelmed by the summits, constantly expanding international relations and new investment projects in the Turkic world. The real motivation behind this evolving region however – beyond historical and cultural richness, strategic location and the slowly but surely liberalizing economies – is the wealth of resources. As Daniel Yergin wrote in the early 2000s “In a world of increasing interdependence, energy security will depend much on how countries manage their relations with one another. That is why energy security will be one of the main challenges of foreign policy in the years ahead. Oil and gas have always been political commodities.” Accepting Yergin’s words, and given the limitations of the genre, this series examines the energy policy significance of four Turkic countries – Türkiye, Azerbaijan, Turkmenistan and Uzbekistan – and try to answer the question in a simplified manner: what the Turkic world can offer Europe on energy. The first part of the series is about Türkiye.

Türkiye, the energy hub

Türkiye’s energy diplomacy is motivated by a comprehensive geopolitical strategy, which goal simply is to grow the country’s regional power, taking advantage of its favorable geographical location and network of connections. By utilizing its location, Ankara can easily become one of the most important transit countries in the world, as it serves as a natural link between the hydrocarbon-rich Caspian region, Central Asia and the Middle East, and Europe, which for long had a constantly growing demand. In this sense, Türkiye has played a significant role in the energy diversification aspirations of the EU for years. The Southern Gas Corridor, which transports Azerbaijani gas to Europe and increase LNG capacities, makes Türkiye an indispensable partner to strengthen the EU’s energy security. Currently, around 10% of the EU’s gas imports enter the Union via Turkish transit.

Since the 1990s, Türkiye has been consciously preparing to expand its role in the regional energy supply chain with a defined strategy; initially as an energy bridge, and in recent years as an important energy hub. In order to do so, the country continuously developed its necessary infrastructure and increased its capacities, which not only enhanced its own energy security, but made it an unavoidable energy market player in the region. It has launched several projects, laid large-capacity natural gas and oil pipelines (e.g. TANAP, BTE, Turkish Stream, BTC), is building a nuclear power plant, and is continuously increasing and expanding its renewable energy park. It is repeatedly enlarging its LNG facilities, allowing it to receive liquefied gas from several continents, thereby reducing its dependence on energy imports.

Transit countries, including Türkiye, act as a buffer zone between energy-rich and energy-poor countries, thus playing a major (de)stabilizing role in global energy supply chains. According to forecasts, the global market share of LNG is to be drastically increased by the end of 2040. Based on this growth trend, Türkiye is striving to become a major LNG player not only for its current energy security but also for its long-term strategic goals. Türkiye already has two onshore LNG terminals and three floating LNG storage and regasification units (FSRUs).

However, we must note that Türkiye’s hub ambition still remains constrained by external supply dependencies and finite transit capacities. Rapid economic and population growth over the past two decades has not only resulted in a strong increase in energy demand but also in increased import dependency. As a result, the Turkish government has set itself the goal of transforming its energy system and reducing its import dependency. As a result of the reform measures, Turkey’s energy mix has been significantly diversified over the past decade, electricity generation from renewable energy sources has tripled, and the commissioning of the country’s first nuclear facility is expected to further diversify its energy mix.

Energy relations of the EU and Türkiye

Türkiye’s transit status has been developing over the past few decades, most notably through the ongoing pipeline and infrastructure projects. Türkiye is an important land link between the hydrocarbon-rich states and Europe, and one of Ankara’s main strategic aspirations since the end of the Cold War has been to strengthen its political and economic role as a transit country and become a key guarantor of European energy security. Ankara plays a significant role in European energy security, as the European Union is a large gas importer and is still heavily dependent on imported natural gas. As a key transit country, Türkiye plays an intermediary role in natural gas supplies to Europe, particularly from the Caspian Sea and Middle Eastern sources.

The dependence on Russian gas has created different regions in Europe, mainly distributed in east-west direction. The Russian-Ukrainian conflict has repeatedly highlighted the need for the EU to diversify its energy sources. In this context, the Southern Gas Corridor, which aims to bring Caspian gas to Europe, has gained increasing importance. Thus, European gas dependence and Ankara’s geographical location are logically linked. Energy relations between Türkiye and the European Union are determined not only by Türkiye’s strategic location, but also by the dynamics of EU energy policy and cooperation in other areas.

The construction and the commissioning of the TANAP pipeline was a determining project for European energy security, as it made it possible for Azerbaijani natural gas to reach European consumers for the first time. The Union’s resilience would be enhanced by expanding the capacities of the Southern Gas Corridor and increasing European LNG capacities.  

However, the potential of the energy relationship between Türkiye and the EU goes well beyond access to new gas markets. With the European Green Deal and EU’s decarbonization goals, natural gas trade will become less and less relevant in the medium and long term.  Low-carbon energy sources and carbon-free electricity are becoming increasingly important and could become a pillar of energy relations between Ankara and Brussels in the future.

From transit hub to strategic partner

For the European Union, it is important that Türkiye continue its efforts to increase its energy security, as the development of alternative transport routes and sources of supply contributes to the stability and security of energy supply across the continent. In addition to delivering Azerbaijani natural gas to European markets, the possibility of exporting Turkmen natural gas also plays a role in this strategy, which can be further strengthened by cooperation between the EU and Türkiye.

Author: Blanka Benkő-Kovács, advisor - LCTS, LUPS