Baku is the capital and largest city of Azerbaijan, as well as the largest city on the Caspian Sea and of the Caucasus region. Baku is located 28 metres below sea level, which makes it the lowest lying national capital in the world and also the largest city in the world located below sea level. Baku lies on the southern shore of the Absheron Peninsula, alongside the Bay of Baku. Officially, about 25% of all inhabitants of the country live in Baku's metropolitan area. Baku is the sole metropolis in Azerbaijan.
Baku is divided into twelve administrative raions and 48 townships. Among these are the townships on the islands of the Baku Archipelago, and the town of Oil Rocks built on stilts in the Caspian Sea, 60 kilometres (37 miles) away from Baku. The Inner City of Baku, along with the Shirvanshah's Palace and Maiden Tower, is a UNESCO World Heritage Site. According to the Lonely Planet's ranking, Baku is also among the world's top ten destinations for urban nightlife.
The city is the scientific, cultural, and industrial centre of Azerbaijan. Many sizeable Azerbaijani institutions have their headquarters there. The Baku International Sea Trade Port is capable of handling two million tonnes of general and dry bulk cargoes per year. In recent years, Baku has become an important venue for international events. It hosted the 57th Eurovision Song Contest in 2012, the 2015 European Games, 4th Islamic Solidarity Games, the Azerbaijan Grand Prix since 2016, hosted the final of the 2018–19 UEFA Europa League, and is one of the host cities for UEFA Euro 2020. The city is renowned for its harsh winds, which is reflected in its nickname, the "City of Winds".
Baku's largest industry is petroleum, and its petroleum exports make it a large contributor to Azerbaijan's balance of payments. The existence of petroleum has been known since the 8th century. In the 10th century, the Arabian traveller, Marudee, reported that both white and black oil were being extracted naturally from Baku. By the 15th century, oil for lamps was obtained from hand-dug surface wells. Commercial exploitation began in 1872, and by the beginning of the 20th century the Baku oil fields were the largest in the world. Towards the end of the 20th century much of the onshore petroleum had been exhausted, and drilling had extended into the sea offshore. By the end of the 19th century skilled workers and specialists flocked to Baku. By 1900 the city had more than 3,000 oil wells, of which 2,000 were producing oil at industrial levels. Baku ranked as one of the largest centres for the production of oil industry equipment before World War II. The World War II Battle of Stalingrad was fought to determine who would have control of Baku oil fields.
The oil economy of Baku is undergoing a resurgence, with the development of the massive Azeri-Chirag-Guneshli field (Shallow water Gunashli by SOCAR, deeper areas by a consortium led by BP), development of the Shah Deniz gas field, the expansion of the Sangachal Terminal and the construction of the BTC Pipeline.
The Baku Stock Exchange is Azerbaijan's largest stock exchange, and largest in the Caucasian region by market capitalisation. A relatively large number of trans-national companies are headquartered in Baku. One of the more prominent institutions headquartered in Baku is the International Bank of Azerbaijan, which employs over 1,000 people. International banks with branches in Baku include HSBC, Société Générale and Credit Suisse.
Baku is rated Gamma + by the Globalization and World Cities Research Network (GaWC) which evaluates and ranks the relationships between world cities in the context of globalisation. Gamma level cities are cities that link smaller economic regions into the world economy.
Baku is the #98 city in the world according to the Global Financial Centres Index (GFCI) which evaluates and ranks the competitiveness of the major financial centres of the world according to a wide range of criteria – Human Capital, Business, Finance, Infrastructure and Reputation.
Baku is rated D+ by the Global Urban Competitiveness Report (GUCR) which evaluates and ranks world cities in the context of economic competitiveness. D+ cities are strong regional hub cities. Baku was ranked #585 by the Nomad List which evaluates and ranks remote work hubs by cost, internet, fun and safety. Baku has a population of over 2,269,700 people.