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. Last Updated: 07/27/2016

THE GREAT GAME: Azeris Relying On Oil Riches For Ban Relief

It was on everyone's minds here last week. "907." I remember when I came to Azerbaijan for the first time everyone seemed to be talking about "907," from ministers to refugees, as if it was the last hope on earth. I did not have a clue what they were going on about.

It was the U.S. Embassy that put me straight. "907" is a caveat added to a piece of U.S. legislation. In full it is Section 907 of the Freedom Support Act for the former Soviet republics, and it bans direct U.S. government aid to Azerbaijan.

The issue behind it is little known but incredibly important to Azeris.

The president bores on about it to every American visitor and with some cause. And every student, refugee or taxi driver I meet asks me what the chances are of it being repealed.

907 was passed during the war between Azerbaijan and Armenia over Nagorny Karabakh, thanks to vigorous activity by the Armenian lobby in Washington. It forbids government-to-government aid to Azerbaijan until it lifts "all blockades and other offensive uses of force against Armenia and Nagorny Karabakh."

It is not so much the money that hurts but the sense of blame 907 carries. Even though Armenia emerged as the greater aggressor, forcing nearly 1 million Azeris from their homes and occupying whole swathes of Azerbaijan, Baku is the one that is branded the aggressor and suffers from sanctions.

Last week, 907 came under review as the Foreign Aid Bill came before Congress. We saw wild swings of optimism and then pessimism in Baku as first the Foreign Relations Committee voted in favor of repealing it, only for the idea to be shot down at the next step in Congress itself.

In fact, the vote was the closest yet, and although it may take a few more years there is a feeling that the tables are slowly turning. The U.S. State Department is firmly behind repealing 907, and Madeleine Albright appealed to Congress to revoke it this time. The U.S. Embassy in Baku also wants 907 abolished.

There are many arguments against 907. It is basically unfair, since Armenia receives one of the biggest U.S. aid packages per capita of anywhere in the world and Nagorny Karabakh also benefits from direct U.S. aid.

And it is counterproductive, if the aim is to make Azerbaijan change its ways. If anything it aggravates tensions, and bars all those U.S.-funded programs that could promote democracy and conflict resolution that other former Soviet republics enjoy. It is, of course, oil that has caused a shift in the balance for or against 907. Albright argued it was in America's geopolitical interests to see Azerbaijan become the conduit for Caspian oil and gas to prevent it from being concentrated in the Persian Gulf. She also talked of assisting U.S. energy companies in pursuing investment opportunities that will make them global leaders.

The big oil companies have been lobbying because 907 is not good for business. It has not prevented them from clinching deals in Baku, but it doesn't help, especially when the president brings it up at every meeting.

So the battle has shifted to Washington, where the oil lobby is taking on the famously well-organized and aggressive Armenian lobby. Azerbaijan is hoping its oil wealth will win the day but as last week showed, it still faces quite a fight.