Azerbaijan recently had to face a wave of criticism from the European institutions (the OSCE and the European Parliament) due to its government’s undemocratic practices. In response, Baku accused its European partners of Islamophobia and declared the suspension of parliamentary cooperation in the framework of the EU’s Euronest. The Azerbaijani ruling elite also blames the West of supporting a “fifth column” in Azerbaijan (meaning civil society organisations) as well as of giving political support to its arch-enemy Armenia in the Nagorno-Karabakh conflict. At the same time authorities in Baku are displaying their developing political partnership with Russia. This paper examines the consequences of the crisis in relations between the EU and Azerbaijan and Azerbaijani-Russian rapprochement for the prospects for EU-Azerbaijan energy projects and regional security in the South Caucasus.