April 08, 2010
Azerbaijan-Iran Foreign Relations
“Azerbaijan would be on the front line of any containment effort against Iran. It has previously assisted US efforts to hinder Iran's nuclear development. On 29 March 2008, for example, Azeri customs impounded for five weeks ten tons of nuclear equipment trucked from Russia and destined for the Bushehr reactor. Subsequently released, Baku's actions presumably aided intelligence understanding of the shipment and suggested willingness to help US counterproliferation efforts.”
In June 2009, Azeri Ambassador to Iran Abasali Hassanov called upon Iranian investors to invest in Azerbaijan, particularly in the fields of oil, gas, power and agriculture.
Iranian-Azerbaijani bilateral trade reached $70 million in 2008, and increased to $70.4 million in the first half of 2009. This value increased further in September 2009 when Azerbaijan agreed to export 5 billion cubic meters of gas to Iran each year. 
On October 28, 2009, a sea passenger line between the Iranian port of Anzali and the Azerbaijani port of Baku was restored; the passenger line was suspended in 1998. Discussions regarding a new transportation line from Baku to the Iranian Caspian ports of Amirabad and Nowshahr are also underway.
Iranian Foreign Minister Manouchehr Mottaki and his Azerbaijani counterpart Elmar Mamedyarov met in December 2009 in Tehran to discuss increasing their countries’ bilateral cooperation in the industry, transportation, energy, and trade sectors. Mottaki said Iran and Azerbaijan plan to increase the volume of their bilateral trade to $1 billion following the finalization of the September 2009 agreement, under which Azerbaijan will export 500 million cubic meters of natural gas to Iran per year. 
In January 2010, the State Oil Company of Azerbaijan and the National Iranian Gas Export Company signed a short-term contract for Iran to import Azerbaijani natural gas. The contract stipulated that Azerbaijan would supplies Iran with 100 million cubic meters of gas between March and April 2010. The United States’ recent sanctions on gas sales to the Islamic Republic caused some concern for Azerbaijan due to its energy and economic ties with Iran. A Senate bill authorized US President Barack Obama to sanction persons or entities that sell gasoline or refined petroleum to Iran. A report from Baku stated that the State Oil Company of the Azerbaijani Republic (SOCAR) and its affiliates do “occasionally” sell oil and other products to Iran.
Azerbaijan and Iran have had unstable relations in the past few years. In July 2001, Azerbaijani research ships and an Iranian gunboat had a small confrontation across their maritime border in a disputed oil field. Since the incident, both sides worked to establish the boundary in the southern Caspian through diplomatic means. Coming together in June 2002, an Iranian delegation led by envoy Mehdi Safari held three days of talks in Baku, aimed at settling the conflict concerning the Caspian Sea border with Azerbaijan. At the conclusion of negotiations, a spokesman for the Iranian Embassy in Baku said "there are no problems between the parties, and technical issues are currently being resolved. Experts are to prepare a document that would meet the interests of the two countries for years to come." Azerbaijan's Caspian representative Khalaf Khalafov responded however, that no progress was made towards diplomatic border negotiations.
Following a June 2009 state visit to Azerbaijan by Israeli President Shimon Peres, Iran recalled its ambassador to Azerbaijan, Mohammad-Bager Bahrami; Head of the presidential administrations’ Foreign Relations Department Novruz Mamedov responded to the recall by saying Azerbaijan is “pursuing our foreign policy course, which does not harm any country." Ambassador Bahrami returned to Baku on July 8, 2009.
In mid-November 2009, the Iranian Cabinet of Ministers began waiving visa requirements for Azerbiajani nationals. Tehran officially informed Baku of the resolution in early January 2010. According to Azerbaijan’s ministry spokesman Elkhan Polukov, visa-free travel for Azerbaijani citizens was set to begin February 1, 2010.
Iran's Manouchehr Mottaki and Azerbaijan's Elmar Mamedyarov met in December 2009 to address common economic and political goals. Most prominent among the diplomatic discussions was Iran’s offer to mediate in the Nagorny Karabakh conflict between Armenia and Azerbaijan.
In March 2010, the Iranian President’s Special Envoy Mehdi Safari and Azeri President Ilham Aliyev met in Baku to discuss avenues of increasing cooperation in Caspian Sea affairs. Safari lauded the friendly relations between the Caspian Sea littoral states and emphasized the necessity for continued cooperation and collective security among the members. President Aliyev agreed with Mr. Safari with regard to the significance of security and cooperation talks between the Caspian Sea states. Iran, Azerbaijan, Kazakhstan, Turkmenistan, and Russia agreed to finalize a draft security agreement prior to the Caspian Sea states third summit of leaders due to be held in Baku later in 2010.