Italy has reinforced its position as the largest European recipient of Azerbaijani oil and natural gas in 2025.
This comes as the State Oil Fund of the Republic of Azerbaijan (SOFAZ) reported a sharp rise in assets driven by hydrocarbon exports and sustained European demand.
According to their official 2025 year-end financial report published in January 2026, the Fund’s total assets increased by 22.5%, totaling around 61 million EUR by the end of 2025, compared to the beginning of the year, totaling around 50 million EUR.
SOFAZ reports that oil and gas revenues continued to play a decisive role in its financial performance, citing stable export flows and strong production from Azerbaijan’s main offshore fields.
Italy at the center of Azerbaijani energy exports
Italy remained the leading European destination for Azerbaijani crude oil in 2025, receiving the largest share of shipments from the Caspian region. Crude delivered to Italian ports is processed at major refineries and redistributed across European markets.
During the 6th session of Azerbaijan–Italy Intergovernmental Commission on Economic Cooperation in Baku on 13 January 2026, Minister of Energy Parviz Shahbazov highlighted that Azerbaijan and Italy have developed a strategic energy partnership, with Italy remaining the country’s main European buyer of both oil and natural gas. These remarks were reported by Azerbaijani and regional media covering commission’s meetings.
Italy is also a key end market for Azerbaijani gas transported via the Southern Gas Corridor, linking the Shah Deniz field to Europe through the South Caucasus Pipeline, Trans-Anatolian Natural Gas Pipeline (TANAP), and the Trans Adriatic Pipeline (TAP), which lands in southern Italy.
As reported by the Azerbaijani Energy Ministry and regional energy media, Shahbazov has talked about the gains at several international energy forums and bilateral meetings in 2025. He has said that Azerbaijani gas supplied through TAP, contributes directly to Europe’s energy diversification, with Italy receiving the largest share of volumes transported via the pipeline.
Alongside Italy, Azerbaijani gas is supplied to Greece and Bulgaria, with smaller volumes reaching other Balkan markets, but Italy absorbs the largest share according to official export data.
Oil and gas revenues underpin SOFAZ income
According to SOFAZ’s official 2025 financial disclosure, oil and gas revenues totaled more than 5 million EUR. Production was led by the Azeri–Chirag–Gunashli oil field and the Shah Deniz gas field, which together form the backbone of Azerbaijan’s export capacity.
SOFAZ reports that these revenues enabled the Fund to meet its fiscal commitments while preserving long-term financial stability.
During the year, the Fund transferred approximately 7.6 million EUR to the state budget, supporting public spending amid ongoing global economic uncertainty.
Strategic importance for Europe
European demand for Azerbaijani energy has remained strong as EU member states seek to reduce dependence on more volatile suppliers and secure long-term, pipeline-based imports.
SOFAZ notes that southern Europe and Italy in particular plays a critical role in ensuring reliable access to Caspian energy, highlighting the importance of infrastructure and long-term contracts.
Over the past five years, SOFAZ’s assets have grown by nearly 70% with oil and gas inflows, continuing to play a central role alongside investment income.
Fund officials said the 2025 results underline Azerbaijan’s position as a long-term energy partner for Europe, with Italy standing out as the principal destination for its oil and gas exports.
