AZERBAIJAN - Decision Makers

President Gaidar (or Haidar) Aliyev takes all decisions relating to oil and gas or any other sector of importance. The state organisations and ministries are paralysed by the need to refer decisions to him. Foreign oil executives complain of waiting for months for deals to be sorted out, either because no one dares to act without clearance from above or because of corruption.

Critics describe Aliyev's regime as a kleptocracy, though other Central Asian rulers are much wealthier, with Kazakhstan's President Nursultan Nazarbayev now being among the richest men in the world. But some of Aliyev's Azeri opponents are very corrupt, as in the case of former parliament speaker Rasul Kuliyev, who once was his close ally.

The future of Azerbaijan depends on its current decision makers, who are the rulers, as in the case of the other Central Asian and Caucasian states. If today's rulers do not improve their system towards a true democracy, these countries could face civil wars and chaos in the next decade.

The landmark agreement of July 6 between Nazarbayev and President Yeltsin on dividing the northern portion of the Caspian seabed between Russia and Kazakhstan paves the way for exploration of what could be the world's biggest supergiant oil field. The Kazakh portion of the seabed is said to contain up to 100 bn barrels of oil, another Kuwait (see News Service of this week's APS Diplomat and survey of Kazakhstan serialised as from next week's APS Review).

The entity in charge of the oil sector is the State Oil Company of Azerbaijan Republic (Socar), which is in charge of the E&P deals with foreign partners, in exploration and production, in operating pipeline systems and in oil refining and gas processing. The State Fuel and Energy Committee is in charge of distribution of oil products and gas. Azerikimya oversees the petrochemicals sector. Azerenergy State Company controls electric power generation and distribution.