| The 
				paper said the EU could reconsider political engagement, 
				financial assistance and sectoral cooperation, without being 
				more specific. It does not mention Azerbaijan's energy sector.
 Azerbaijani forces seized control of the enclave - populated 
				mainly by ethnic Armenians - last month, triggering an exodus of 
				more than 100,000 people to Armenia.
 
 EU foreign policy chief Josep Borrell and many leaders of the 
				27-nation bloc condemned the operation. But diplomats say there 
				are disagreements among EU countries over whether to take firmer 
				diplomatic or political action.
 
 The EU's search for a response is complicated by its moves to 
				rely more on Azerbaijani oil and gas as it has moved away from 
				Russian energy due to Moscow's war in Ukraine.
 
 The paper, prepared by the European External Action Service and 
				seen by Reuters, outlines further possible reaction but is 
				cautious in tone.
 
 It says that if the situation deteriorates, the EU could 
				consider a review of its relations with Azerbaijan "on the basis 
				of a gradual approach".
 
 "In case serious human rights violations are committed, 
				restrictive measures against individuals responsible for such 
				violations could be envisaged," the paper said.
 
 Decisions on EU sanctions generally require unanimity among 
				member countries.
 
 A diplomat from a country favouring a tougher stance toward 
				Azerbaijan, speaking on condition of anonymity, said the 
				document "reflects a balance of different positions of member 
				states: We want more, but others do not want anything at all."
 
 Diplomats say France, Germany and the Netherlands are among 
				those pushing for strong signals of disapproval toward Baku 
				while others such as Austria and Hungary are at the opposite end 
				of the spectrum.
 
 A second diplomat said the EU may not end up doing much more 
				than condemning Azerbaijan's action and instead focus on 
				supporting Armenia, economically and possibly with military aid.
 
 The paper suggested the EU consider "political and economic 
				actions to further support the democratically elected 
				authorities of Armenia, including in the area of security and 
				resilience, and the continuation of the democratic reforms".
 
 (Reporting by Andrew Gray and John Irish; writing by Andrew 
				Gray, Editing by Angus MacSwan)
 
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