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In light of Europe's diversification efforts and of tensions with Ukraine, Russia is building the South Stream pipeline under the Black Sea (through Turkish territorial waters). At the same time, Turkey is strengthening its position in South Stream's rival projects, which aim to supply the EU with gas from the Caspian Sea. This means there is a difficult balance here: while Russia attempts to protect its European revenues, Turkey is trying to enhance its status as an energy hub between Europe, the Caucasus and the Middle East. In addition, the Turkish government and, increasingly, private Turkish operators are developing an energy partnership with Russia in a growing number of fields, including nuclear power. The economic significance of these common projects explains the desire of the two countries to play down their contrasting political interests in the Middle East.

This paper is the product of cooperation between the Russia/NIS Center and the Contemporary Turkey Research programme, Ifri.