Caspian Sea Trade Routes at Crossroads Amid Security Concerns and Environmental Issues

Since 2022, but particularly in 2026, hard maritime security issues on the Caspian Sea have started moving to the forefront. Until March 2026, the primary threats to developing trade corridors across the Caspian Sea seemed to be inadequate infrastructure and falling water levels. Then Israel targeted Iranian naval assets in the sea, followed in July by a Ukrainian attack on Iranian military shipments in the waterway. Conflict in the Caspian Sea has made it clear that physical maritime security is essential to making the east-west route a viable, reliable alternative conduit for critical resources. The Trans-Caspian International Transport Route, the east-west route known as the Middle Corridor, provides 4,250 kilometers of rail lines and 500 kilometers of sea connections between Europe and Central Asia, transiting through Türkiye, Azerbaijan, Kazakhstan, and Uzbekistan. The Middle Corridor will also potentially connect further to China via a new rail line through Uzbekistan and Kyrgyzstan and link Armenia and Azerbaijan through the 42-kilometer Zangezur Corridor thanks to the U.S.-sponsored TRIPP deal. A second route, the International North-South Transport Corridor, once developed, would span 7,200 kilometers and connect Russia to the Persian Gulf, via the Caucasus, the Caspian Sea, and India. Conceived more than 20 years ago, the proposed north-south route has gained new life due to Russia’s need for alternative routes since the full-scale war in Ukraine and India’s interest in a route to the Arctic circumventing China. Both trade routes highlight the Caspian region’s centrality for supply chain resilience and the expansion of connectivity. Nevertheless, many bottlenecks prevent these ambitions from reaching fruition. The World Bank argues that trade along the route could triple by 2030 if ten priority actions are taken immediately. These include improving port infrastructure and rail connections, increasing the quantity of rolling stock, and addressing customs, logistics, and governance challenges. The declining water level of the Caspian Sea exacerbates these challenges. Russia has been damming the Volga River, which accounts for approximately 80 percent of the Caspian’s water. Kazakhstan’s Ministry of Natural Resources attributes the shallowing and retreat of the Caspian Sea to climate change. Although the shallowing began in the 1990s, the water level has declined to a new low in 2026. Higher air and water temperatures contribute to further evaporation. Dredging is a short-term, and expensive, solution and ferry transport – crucial for exports of critical minerals from Central Asia – already has been reduced along some routes. Although the Middle Corridor states are well aware of the problems, with Kazakhstan declaring the dropping water level a state of emergency in 2023, the fossil fuel and maritime industries they depend on further contribute to the Caspian Sea’s shallowing. The Caspian region also faces geopolitical headwinds. Russia and Iran have historically blocked Caspian pipeline projects that dilute their own leverage on fossil fuel exports. China would seem to benefit from an alternative trade route given the interruptions to other routes that Russia’s war in Ukraine has caused. Some observers see China treading cautiously with the China-Kyrgyzstan-Uzbekistan railway to avoid a negative reaction from Russia. Others see China’s potential for greater involvement as counterproductive to a trade route for critical minerals that is supposed to provide an alternative to Chinese supply chains. U.S. opposition to a sanctioned Chinese company serving as operator for a new deepwater port of Anaklia on Georgia’s western Black Sea coast, a project seen as important for the further expansion of the Middle Corridor, may have contributed to the Georgian government’s decision to retain control. However, since 2022, but particularly in 2026, hard maritime security issues on the Caspian Sea have increasingly moved to the forefront. The North-South Vector: Sanctioned Trade and Arctic Gateway The North-South vector of the Caspian Sea involves conflict-related trade flows between Russia and Iran and a framework for a multilateral trade route involving India. With the Black Sea under Ukrainian attack, Russia’s 2 million tons of annual wheat deliveries to Iran are now being shipped via the Caspian Sea. In 2026, Russia also began sending parts for Geran-2 drones to Iran to replenish its supplies used in the war with the U.S. and Israel. Ukrainian sources allege that Russian-made drones based on Iranian technology have been found in the UAE, indicating Russian transfer of their own production to Iran. Iran has been shipping ammunition and three types of drones to Russia via the Caspian Sea for the war in Ukraine, as CNA explored in a January 2025 report on the Russia-Iran Relationship. Iran also provided related training and facilitated Russian production of Iranian drones inside Russia. The two countries used “dark port calls” – that is, sailing without using required transponders – to mask their covert Caspian Sea transits. Such efforts did little to camouflage the arms trade in the Caspian Sea. Russia has launched attacks on Ukraine from its Caspian flotilla. For its part, Ukraine views Iranian and Russian vessels involved in weapons trade for Russia’s war as fair targets. One Iranian sailor was killed in a July 25 Ukrainian drone attack on a cargo ship. On March 18, Israel attacked the Iranian port of Bandar Azali, its first Iranian target on the Caspian Sea, to disrupt Iran’s supplies of military equipment from Russia. These attacks raised concerns in India, which signed an agreement with Iran in 2024 to operate the Shahid Beheshti terminal at Chabahar Port on the Gulf of Oman. New Delhi is eager to develop the North-South trade corridor with Russia, Iran, and Caspian states such as Kazakhstan and Azerbaijan. India and Russia signed an agreement in December 2025 for partnership in the Arctic, including using the North-South corridor to expand Indian access to the region. Russia has been enthusiastic about greater Indian participation to offset the prevalence of “unfriendly countries” and balance China’s greater activism in the Arctic. The East-West Corridor: Economic Potential and Security Threats Since 2022, the Caspian region has grown in importance as a source and transit region for Western energy and mineral resources. Energy remains the most important regional export. Over 90 percent of Azerbaijan’s oil and gas production is offshore in the Caspian region. Kazakhstan and Turkmenistan, meanwhile, extract most oil and gas onshore and historically have exported it via pipelines through Russia and China. However, even before Ukraine’s systematic campaign against Russian energy infrastructure in 2026, Kazakhstan had increased shipments of oil across the Caspian Sea via the Baku-Tbilisi-Ceyhan (BTC) pipeline to avo