Azerbaijan is wrestling with a geopolitical dilemma following President Ilham Aliyev's recent visit to Iran. Azerbaijani officials want to foster better relations with Iran while maintaining a strong strategic relationship with the United States. Striking the proper diplomatic balance is proving tricky for Baku, given the long-standing animosity that exists between Washington and Tehran.

Aliyev's January 23-26 trip to Tehran produced no major breakthrough in bilateral relations. Throughout the visit, however, the mutual benefits of cooperation were readily evident. From the viewpoint of Azerbaijani officials, stronger Iranian-Azerbaijani ties could strengthen Azerbaijan's position in several key diplomatic areas, especially the Nagorno-Karabakh conflict and energy development. Iran has close political and economic ties with Armenia. [For background see the Eurasia Insight archive]. Officials in Baku hope that an improvement in Iranian-Azerbaijani relations could cause Iran to exert pressure on Armenia to revise its stance on Karabakh peace talks. [For background see the Eurasia Insight archive].

During a meeting with Aliyev, Iranian President Mohammad Khatami voiced support for Azerbaijan's stance on the Karabakh issue. "Our position is clear and Iran is one of the very few countries that support Azerbaijan's position," AzerNews reported Khatami as saying. "We support a conflict resolution not by force, but through talks and diplomacy."

For Iran, an improving relationship with Azerbaijan could enhance Tehran's image as a "good neighbor," countering US claims that the Islamic Republic is a destabilizing force in the region. More broadly, closer Iranian-Azerbaijani cooperation could help diminish the impact of growing US pressure on Tehran. [For background see the Eurasia Insight archive].

One Azerbaijani government official, speaking on condition of anonymity, told EurasiaNet that Baku's cautious rapprochement with Tehran is fueled in part by the lack of high-profile attention paid by the White House to Aliyev. Unlike his Georgian counterpart, Mikheil Saakashvili, the Azerbaijani leader has yet to be invited for an official visit to the United States. Likewise, few top Bush administration officials, outside of Defense Secretary Donald Rumsfeld, have made stops in Baku of late. Washington also did not send a high-profile delegation to commemorate the 10th anniversary of the signing of the so-called "contract of the century," a $7.4 billion production sharing agreement for Azerbaijan's Caspian Sea oil reserves.

Shortcomings are also seen in Washington's efforts to resolve the Karabakh conflict, the official said. [For background see the Eurasia Insight archive]. Azerbaijan's opposition media, in fact, took Aliyev's trip to Tehran as a sign of official dissatisfaction with the US role in the Minsk Group, the body set up by the Organization for Security and Cooperation in Europe to negotiate a deal on the disputed territory. Meanwhile, in addition to Iran, Baku is also looking to Russia to support its regional interests, as Russian Foreign Minister Sergei Lavrov's Feb. 1-3 visit to Azerbaijan indicated. "Washington's inadequate presence and support amidst increasing Russian and Iranian influence in the region is troubling," the Azerbaijani official said.

Several obstacles must be cleared away before Iran and Azerbaijan can forge a genuinely close partnership. Perhaps the biggest difference concerns energy development, namely the two countries' competing claims to portions of the resource-rich Caspian Sea.

Of late, Tehran has made several good-will gestures. For example, Iranian officials sanctioned the opening of an Azerbaijani consulate in the Iranian city of Tabriz, a center of Iran's sizeable ethnic Azeri minority. Iran also plans to extend $4 million worth of loans to Azerbaijan for construction of a highway from Astara, a town near the Iranian border, to Baku. In addition, Iran has provided $1 million for construction of a bridge over the Araz River in the Azerbaijani exclave of Nakhichivan, which borders Iran.

Aliyev's visit generated speculation that visa-free travel could soon be introduced between the two countries. But in a February 10 statement to reporters, Azerbaijani Deputy Foreign Minister Araz Azimov said that the step would be premature so long as "issues like regional security" remained undefined, Baku Today reported.

The cultivation of Iranian-Azerbaijani friendship is taking place against the backdrop of a hardening US position toward Iran. In recent months, American criticism of Iran, especially of its nuclear research program, has intensified. In his February 2 State of the Union address, US President George W. Bush described the Islamic republic as "the world's primary state sponsor of terror -- pursuing nuclear weapons while depriving its people of the freedom they seek and deserve."

Such rhetoric has prompted political analysts in the region to wonder if the United States, despite its difficulties in promoting stabilization in Iraq, is planning to undertake regime-change action against Iran. A January 27 commentary in the Azerbaijani opposition newspaper Zerkalo expressed the belief that US action against Iran is inevitable. "It is just a matter of when," the commentary said.

Given the US hostility towards Iran, Azerbaijani officials realize that they must tread carefully as they seek to improve ties between Baku and Tehran. Balancing Azerbaijan's interests between the US and Iran, will prove a major challenge for the Aliyev administration, commented Nasib Nasibli, a former Azerbaijani ambassador to Iran who now works as an independent political scientist. "It will not be easy to make the right decision . . . It will be a major test for the authorities' foreign policy," Nasibli said. "Yet, in the end, it will be difficult to abstain from US policy towards Iran."

In the end, some analysts say, Aliyev's trip did little to advance Azerbaijan's long-term goals. "In my mind, the timing of the trip was poorly chosen, because the geopolitical situation around Iran is quickly changing," said political analyst Gabil Huseynli. "From this perspective, the economic interests of Azerbaijan should not outweigh the political ones."