Weekly Eurasia Review

Week 36

The most important developments from across Eurasia this week – selected news, analyses and broader trends.

1. News Map

Markets and Economy

1. Pipelines Cannot Replace the Strait of Hormuz

The war has accelerated Gulf investments aimed at transporting oil to global markets while bypassing the Strait of Hormuz, but their capacity remains limited. Saudi Arabia’s East-West Pipeline has a maximum capacity of around 7 million barrels per day, while the UAE’s Habshan-Fujairah pipeline can currently carry roughly 1.5 million barrels per day, with plans to double that figure. This still falls well short of the approximately 20 million barrels per day of oil and petroleum products that pass through Hormuz in peacetime. For Qatar’s LNG exports, meanwhile, there is effectively no comparable alternative route. There is considerable debate over the actual volume of traffic. In August, the US administration cited close to 9 million barrels per day of maritime traffic and, including bypass pipelines, around two-thirds of pre-war volumes. Commercial ship-tracking companies have regularly recorded lower figures; part of the discrepancy may be explained by tankers operating without active AIS transponders. The strategic conclusion remains unchanged: some oil exports can be diversified, but Hormuz cannot be fully replaced, particularly in the case of LNG and container shipping.

2. First Kyrgyz Tunnel Completed on the CKU Railway

The first tunnel on the Kyrgyz section of the China-Kyrgyzstan-Uzbekistan railway has been broken through, the 209.6-metre-long Kosh Dobo North No. 2 tunnel. The full railway will extend for more than 500 kilometres, around 300 kilometres of which will run through Kyrgyzstan. The long-term significance of the Kashgar-Torugart-Jalal-Abad-Andijan axis goes beyond another Chinese infrastructure investment. The railway will provide China with a more direct rail connection to the Fergana Valley and Central Asia. Chinese goods arriving in Uzbekistan could then continue towards the Caspian Sea and the South Caucasus. The project’s ultimate value will depend on how effectively the bottlenecks created by mountainous construction, differing railway gauges and border crossings can be addressed.

3. Kazakhstan Signs Construction Contract for Its First New Nuclear Power Plant

Kazakhstan Nuclear Power Plants and Rosatom subsidiary Atomstroyexport signed a contract in early September for the design, supply and construction of Kazakhstan’s first new large-scale commercial nuclear power plant. The facility is planned for the Zhambyl district of the Almaty region, with construction expected to take around eight years. The final Kazakh government approval procedures required for the contract, however, have not yet been completed. Rosatom was selected from a shortlist that also included China’s CNNC, France’s EDF and South Korea’s KHNP. Kazakhstan approved the reintroduction of nuclear power in an October 2024 referendum, and the government plans to build several nuclear power plants over the longer term. Kazakhstan’s nuclear programme is particularly significant because the country is already a major player in the global uranium market. The issue is therefore not simply the construction of new generating capacity, but also the extent to which Kazakhstan can move beyond its role as a raw-material producer towards higher-value-added nuclear industrial and technological capabilities.

4. Central Asia’s Energy Transition Depends on Water Security

Central Asia’s energy transition is becoming increasingly dependent on the region’s water security. According to the World Bank, around 30 percent of the region’s glacier area has disappeared over the past six decades; in Uzbekistan, available water resources could decline by 30–40 percent by 2050, while irrigation demand could increase by approximately 25 percent over the same period. The interdependence of water and energy systems is illustrated by the fact that 2.4 million hectares of irrigated land in Uzbekistan require pumping, while the roughly 1,700 pumping stations used for this purpose consume 7.2 TWh of electricity annually. Kazakhstan and Uzbekistan are rapidly expanding their solar, wind and energy-storage capacities, while Kyrgyzstan and Tajikistan continue to rely heavily on hydropower. According to one regional modelling study, deeper integration of the Kazakh, Uzbek and Kyrgyz electricity systems, combined with expanded renewable capacity, could reduce annual system costs by around $3.5 billion, or 18 percent, by 2035. Regional energy security can therefore increasingly no longer be treated simply as a question of building new generation capacity: coordinating water management, electricity trade and grid development is becoming one of the fundamental conditions of the energy transition.

5. The SCO Expands Institutionally, but Still Has No Development Bank of Its Own

At the September 1 SCO summit in Bishkek, member states amended the organisation’s Charter and approved the operating rules of two new security structures – a centre dealing with general security threats and a counter-narcotics centre. A total of 28 documents were adopted, covering areas including transport, digitalisation, energy and climate. The long-planned SCO Development Bank, however, has still not been established. Although there is political support for the institution, there is still no founding agreement, final capital structure or launch date. Moreover, both Bishkek and Kazakhstan have expressed interest in hosting the bank’s headquarters. Pakistan will assume the 2026–2027 rotating presidency, with the next summit of heads of state expected to be held in Islamabad. One of the SCO’s fundamental contradictions is particularly visible here: the organisation is placing an ever-wider range of economic and security issues on its agenda, while still lacking a functioning multilateral development institution of its own to finance its ambitious cooperation plans.

6. Armenian Constitutional Court to Review the TRIPP Agreement in September

On September 15, Armenia’s Constitutional Court will examine whether the obligations undertaken in the US-Armenian framework agreement related to the TRIPP transport corridor comply with the Armenian Constitution. Importantly, the immediate subject of the proceedings is the US-Armenian framework agreement, rather than the Armenian-Azerbaijani peace process as a whole. Meanwhile, preparations for practical integration are also advancing. On August 25 in Lachin, Armenian and Azerbaijani energy experts discussed cross-border electricity trade and the possible interconnection of the two countries’ power grids. No concrete import or export agreement has yet been concluded. TRIPP therefore has a dual significance. On the one hand, it raises legal and sovereignty questions in Armenia; on the other, it could provide a framework for broader transport and energy integration. The decisive question will be how much of the political agreements ultimately translates into functioning road, rail and energy infrastructure.

Security and Defence

1. Iranian Hackers Target Albania’s Postal Service

The Iran-linked Homeland Justice hacking group announced on several Telegram channels that it had successfully breached the security systems of Albania’s postal service and published several internal emails as evidence. The Western Balkan country has suffered a series of cyberattacks in recent years after hosting around 2,000 members of the Mujahedin-e-Khalq organisation, which Iran designates as a terrorist group. According to the Albanian government, although a cybersecurity incident did occur, the preliminary investigation found no encrypted or deleted data, and the attack caused no direct disruption to services.

2. Escalating Maritime Confrontation in the Strait of Hormuz

According to CENTCOM, US forces attacked three Iranian oil tankers after the IRGC launched ballistic missiles at US warships. The US side said the Downy and Stark I tankers had been rendered inoperable, while the crew of the Kylo was ordered to abandon ship before the tanker sank in the Gulf of Oman following the attack. Iran, meanwhile, reported attacks on vessels travelling along “unauthorised” routes and on US-linked shipping, although some of these claims were not confirmed by independent maritime security reports. Commercial traffic remains extremely low and volatile: according to Kpler data, only one observable cargo vessel transited the Strait of Hormuz on September 5. Actual traffic may nevertheless have been higher, as many tankers have been operating with their AIS transponders switched off.

3. New Developments in Uncovering Syria’s Chemical and Nuclear Programmes

Syria has begun dismantling chemical-weapons capabilities remaining from the Assad era. For the first time since 2014, the OPCW monitored such an operation in the country and verified the irreversible destruction of 42 unfilled aerial bombs capable of delivering chemical weapons. At the same time, significant progress has been made in uncovering Syria’s former secret nuclear programme. The IAEA confirmed that the Deir ez-Zor facility destroyed in a 2007 Israeli airstrike was a nuclear reactor under construction. Investigations at related sites identified approximately 73 tonnes of natural uranium, around 55 tonnes of which was in the form of fuel rods. The material is currently under IAEA safeguards. Taken together, the two processes signal an important shift: following Assad’s fall, Damascus has become substantially more cooperative with international monitoring organisations.

4. Damascus Continues to Seek a Diplomatic Settlement with Israel

Syrian Foreign Minister As-Shaibani confirmed on September 1 that despite repeated Israeli attacks, Damascus continues to seek a diplomatic agreement through US mediation. Syria’s objective is the withdrawal of Israeli forces to their positions prior to December 2024 and the full restoration of the 1974 disengagement agreement. The talks, however, are complicated not only by Israeli-Syrian relations but also by Türkiye’s growing military role in Syria. On August 18, Israel carried out eight airstrikes against the Abu al-Duhur airbase; according to the Israeli argument, Damascus was preparing for the deployment of Turkish forces there. Ankara condemned the attack. The key point is therefore not that Syria and Israel are close to political normalisation, but that an American-mediated security dialogue now exists alongside the military confrontation. Its durability will partly depend on whether the tensions between Israeli security requirements and Turkish-Syrian military cooperation can be managed.

5. The TTP Issue Continues to Block a Pakistan-Afghanistan Rapprochement

As we have previously reported, relations between Kabul and Islamabad have deteriorated significantly in recent years, culminating in open armed clashes in recent months. Islamabad argues that meaningful normalisation is possible only if the Taliban leadership takes “concrete and verifiable” action against Tehrik-e-Taliban Pakistan (TTP), the BLA and other groups operating from Afghan territory against Pakistan. Chinese Special Envoy Yue Xiaoyong, meanwhile, is working to revive the so-called Urumqi process. According to the latest UN reports, the Taliban have relocated around 2,000 TTP fighters and their family members farther away from the Pakistani border, but Islamabad argues that this does not amount to an actual break with the organisation. The political dispute is also having increasingly serious economic consequences. Participants at a forum in Peshawar estimated that the prolonged closure of Torkham and other trade crossings has caused more than $1 billion in losses to Pakistani trade. This figure should, however, be treated as an estimate by stakeholders rather than independently audited data. The issue extends well beyond bilateral relations: any regional connectivity project seeking to link Central Asia through Afghanistan to Pakistan and the Indian Ocean ultimately runs into the same security problem.

Culture, Arts and Science

1. For a Few Days, Bishkek Became the Focus of Everyone Following Asia’s Growing Importance

The 6th World Nomad Games concluded on September 6, returning to Kyrgyzstan, where the event was first launched in 2014. Following editions hosted by Türkiye in 2022 and Kazakhstan in 2024, the Games’ return attracted particularly strong political visibility because it coincided with the SCO summit in Bishkek. Leaders from Russia, India, Iran, Türkiye, Kazakhstan, Pakistan and Belarus, among others, attended the opening ceremony. The event’s significance, however, extended well beyond sport. With the SCO summit, the 35th anniversary of independence and the Games taking place at the same time, Bishkek found itself at the centre of an unusual degree of international attention. Kyrgyzstan was able to use this moment not only to showcase its cultural identity, but also to raise the visibility of its regional importance and strategic projects such as the China-Kyrgyzstan-Uzbekistan railway.

Worth Noting

1. The Global AI Race Is Taking Shape Around Two Blocs

The US-China technology rivalry is increasingly reflected in the emergence of two international cooperation frameworks built around different approaches. The US-led Pax Silica focuses on the physical and industrial foundations of artificial intelligence – critical raw materials, energy, advanced manufacturing, semiconductors and AI infrastructure – and primarily brings together European and Indo-Pacific technology partners. The China-initiated World Artificial Intelligence Cooperation Organization (WAICO), by contrast, places greater emphasis on AI governance and international cooperation; its 29 founding members include strong representation from the Global South, including ten African countries, as well as Brazil, Indonesia, Pakistan, Russia and several Central Asian states. Kazakhstan is the only country associated with both initiatives, illustrating that the emerging technological divide does not yet amount to rigid bloc formation. Although the two initiatives are not direct equivalents, they demonstrate how the global competition over AI is no longer only about technological development, but increasingly about influence over supply chains, infrastructure, standards and international rules.

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