The European Union has gradually assumed a key role in the peace talks between Armenia and Azerbaijan, which has undermined the Kremlin’s longstanding dominance in the region. Russia is now likely to redouble its efforts to demarcate the border between the two countries and establish new regional infrastructure, but it has little interest in a final peace settlement, which would weaken its influence.

On May 22, the leaders of Azerbaijan and Armenia gathered in Brussels for a new round of discussions regarding a final peace agreement following the 44-day long war in 2020. The meeting was initiated by the EU, which has gradually assumed a key role in the negotiations over Nagorno-Karabakh. The second meeting in Brussels, followed by an April meeting, scored positive results as leaders agreed to finalise the border demarcation.

Although both sides earlier agreed to establish a Joint Border Commission to delimit their mutual boundary line and to “establish a stable security situation” around the border until the end of April, delays occurred on Armenia’s end following Prime Minister Nikol Pashinyan’s official visit to Moscow on April 19, shortly after the Brussels meeting. In Moscow, Pashinyan discussed with President Vladimir Putin the importance of "implementation" of the 2020 November 9, 2021, January 11, and November 26 trilateral statements following the leaders’ meetings in Sochi and Moscow.

As for Azerbaijan President Ilham Aliyev, shortly after the Brussels meeting, he held a phone conversation with Putin to discuss the Azerbaijan – Armenia normalisation process.

The frequent contact of both leaders with Putin ahead and after their negotiations in Brussels is not a new phenomenon, as Moscow cautiously monitors the EU’s enthusiastic efforts to take the Nagorno-Karabakh negotiations away from its orbit. This should not come as a surprise, as Moscow secured a position for itself as a "security guarantor" with the 2020 November 9 ceasefire agreement between Azerbaijan and Armenia. The agreement established Russia as the primary stakeholder in the post-conflict period and enabled it to build a long-desired footprint in the region by deploying peacekeeping forces to the disputed Karabakh region.

However, Moscow's efforts to achieve tangible results in border demarcation and the establishment of new regional transport infrastructure during the Sochi meeting on November 26 and the January 2022 Moscow meeting were unsuccessful.

The  EU therefore intervened in the process to push Baku and Yerevan into more intense negotiations, which sharply undermined the Kremlin’s position as a mediator. Given the EU's vast economic resources, allocation of post-conflict financial aid to Baku and Yerevan respectively, and experience in conflict mediation, its emergence as a new negotiation platform for Azerbaijan and Armenia has diminished the negotiating position established by Russia.

However, although Russia has been distracted by the invasion of Ukraine since February 2022, it is unlikely to tolerate the EU’s efforts to monopolise the Nagorno-Karabakh peace negotiations. Already, Russia’s Ministry of Foreign Affairs spokesperson Maria Zakharova described the EU’s initiatives as “shameless attempts of Brussels to appropriate the subject of the well-known Russian-Azerbaijani-Armenian agreement reached at the highest level”.

In order to strengthen its image as a mediator, Russia is now becoming more actively involved in the border demarcation process between Baku and Yerevan and has managed to schedule an official meeting of the joint commission in Moscow. Given its military footprint in the Karabakh region and its substantial security leverage over Armenia, Moscow will also be directly taking part in the possible opening of regional communication lines.

In contrast to Armenia – which sees the opening of regional communication lines with Azerbaijan as a potential threat to its sovereignty and national security – Russia is interested in establishing new ways of land connection within the region. Such a development would enhance its position politically and economically and give it more leverage over the regional states.

However, unlike the EU, Moscow is less interested in mediating a final peace between the two parties as it would require the withdrawal of the Russian peace forces from the Karabakh region. It is noteworthy that Russia's peace contingent in Karabakh has frequently become a target for harsh criticism from Azerbaijan and Armenia, as the contingent has often seemed more interested in solidifying its presence in the region than in enforcing the peace. Such uncertainty enables Russia to manipulate the peace process of Karabakh and press conference with Russian Foreign Minister Sergei Lavrov, – all of which  clearly showcased that Russia is trying to disparage the Brussels agreement on border demarcation. Russia is in effect warning the Europeans not to interfere in this issue, for which it has set up a trilateral Russia-Armenia-Azerbaijan format since 2020.

Russia's reaction may also be a result of the pragmatic approach of the ruling Armenian government to normalising ties with Azerbaijan. Yerevan’s engagement in normalisation talks has led to mass unrest in Yerevan, with radical opposition leader Ishkhan Saghatelyan announcing "we are launching a popular protest movement to force Pashinyan to resign”. According to Saghatelyan, “Nikol Pashinyan is a traitor and prepares to hand over the contested region to Azerbaijan”. Though the opposition held several protests in Yerevan, no significant success has been achieved so far.

The de-facto separatist regime in Nagorno-Karabakh has also joined the vocal criticism of Pashinyan over his negotiations with Azerbaijan and even proposes more radical solutions. Minister of Foreign Affairs of the so-called separatist regime David Babayan has warned that "without Karabakh, the geopolitical landscape of the Caucasus will significantly change".

Sasun Barseghyan, the former leader of the Askeran region within Nagorno-Karabakh, has proposed holding a referendum on joining Russia in order to “avoid physical annihilation, to save the remains of the shattered Karabakh”. The same idea was reiterated by Margarita Simonyan, the editor-in-chief of Russia Today, a Russian state propaganda media outlet. Given the status of Simonyan within the Russian propaganda network, her statement represents the expression of a certain current of opinion in Moscow.

Another vocal promoter of such provocative ideas is Konstantin Zatulin, the first deputy chairman of the State Duma Committee on CIS Affairs, who proposed that the analogous “model” of the so-called “Donetsk People’s Republic” (DPR) and “Lugansk People’s Republic” (LPR) in Ukraine could be applied to Azerbaijan’s Nagorno-Karabakh territory.

Even though Moscow seeks to monopolise the Nagorno-Karabakh peace negotiations, it clearly understands that there are now two major platforms for negotiations – Moscow and Brussels. Russia cannot and is not able to isolate Azerbaijan and Armenia from holding contracts with the EU.

Russia and the EU want the demarcation of the borders between Azerbaijan and Armenia to be finalised soon, though Russia is not eager to mediate the final peace agreement and the region's final status – this would make Russia's further military presence in the region irrelevant. As for Azerbaijan, it will be manoeuvering between Moscow and Brussels to keep both formats alive and reach a final solution to this long conflict with Armenia.