Four decades ago, the Strait of Hormuz revealed its fatal vulnerability to the global oil market. During the Iran-Iraq War from 1980 to 1988, both sides repeatedly targeted oil tankers in the strait, turning one of the world’s most vital waterways into a floating battlefield.
Saudi Arabia responded by building an east-west pipeline through its vast desert peninsula to the Red Sea port of Yanbu. Years later, the United Arab Emirates (UAE) followed the Habshan-Fujairah Pipeline from the Emirate of Abu Dhabi to the Gulf of Oman.
The weakness of Hormuz reached its peak in late February when the US-Israel sided with Iran. Tehran kept its old promise to close the strait if it was ever attacked. The move stranded hundreds of oil and gas tankers, shutting down about a fifth of the world’s energy supply.
The focus now turns to de-risking Hormuz to ensure the narrow waterway can never again be weaponized in the same way. The energy market is relying on other oil producers to increase production, while global powers such as China, India and the European Union, along with environmental groups, are increasingly encouraging investment in renewable energy.
Competition in Gulf countries to bypass Hormuz
Meanwhile, Gulf leaders are moving forward with plans that would allow them to bypass crude oil entirely and help secure exports in the long term.
Earlier this month, financial Times It was reported that Saudi Arabia, the United Arab Emirates and others were actively considering alternative onshore expanded export terminals as well as new oil pipelines to run parallel to existing structures.
Landon DeRentz, senior director of the Global Energy Center at the Atlantic Council think tank, called on the Trump administration to support new projects with US funding.
“Rather than forcing ships through the chokepoint, the United States and its allies should rapidly build around it,” he wrote in a recent dispatch. “Saudi Arabia … has already proven that bypass infrastructure can relieve some bottlenecks … that model should now be dramatically scaled up.”
The existing 1,200 kilometers (746 mi) Saudi pipeline is already running at a maximum capacity of 7 million barrels per day (bpd), up from 5 million before the war, while the UAE is piping an additional 1.8 million bpd to its Fujairah port.
Saudi Arabia, UAE need to ‘double’ pipeline capacity
While these measures are providing a buffer to global oil markets, the scale of the challenge is clear to Robin Mills, CEO of Qamar Energy, a leading Dubai-based consultancy specializing in Middle East energy strategy and geopolitics.
“Before the war, about 15 million barrels a day of crude oil passed through the straits,” Mills told DW. “You will need to double [current pipeline capacity] To pull out all core crude oil exports.”
foot Officials and energy experts were quoted as saying that even though new pipelines are expensive, time-consuming and sometimes politically complex, they may be the only way Gulf countries can reduce their vulnerability to future disruption.
Mills said many of these bypass plans had been in the works for years. But programs involving many countries were halted due to distance, cost and regional rivalries.
No way for anyone around Hormuz
“New Saudi or UAE routes could go ahead almost immediately and take a few years to build,” Mills said. Kuwait, Bahrain and Qatar face a major geographical problem, he said, because they have no alternative coastline and almost all of their hydrocarbon exports come from Hormuz.
“They will probably have to go through Saudi Arabia or Iran, which means long pipelines and complex political negotiations, which will take at least three to four years – maybe even longer.”
Apart from the Gulf countries, international organizations are also pushing for comprehensive regional solutions as part of a broader risk reduction effort. The International Energy Agency (IEA) is seeking a huge new pipeline from Iraq to Türkiye’s Mediterranean port of Ceyhan.
IEA executive director Fatih Birol told the Turkish newspaper Hurriyet It said last week that the “extremely attractive” project would boost energy security, “especially from Europe’s perspective,” and “the issue of financing can be overcome.”
Iraq accelerates progress on western pipeline
Iraq’s existing export pipeline from the northern Kirkuk region to Turkey was built in the 1970s and restarted last September after a two-and-a-half-year shutdown. It is now pumping up to 250,000 barrels per day.
The Hormuz crisis has also given new impetus to other Western routes. Earlier this month, the Iraqi government advanced the $4.6 billion (€3.9 billion) Basra-Haditha section leading south to the Syrian border to the bidding stage.
The 685-kilometre line is seen as an important first step that could later extend to Jordan’s Red Sea port of Aqaba or possibly to Syria or Turkey. If approved, it will have the capacity to supply up to 3 million bpd in phases.
Iraq is also considering a separate pipeline to the Oman port of Duqm, located on the Gulf of Oman, preliminary talks for which were announced in September.
Overland routes gain momentum
In addition to pipelines, Gulf countries already have concrete plans to expand the limited rail and road networks connecting Gulf states to help streamline non-raw commodity exports. The flagship GCC (Gulf Cooperation Council) railway aims to deliver an integrated network of 2,100 kilometers across all six GCC states by 2030.
The UAE’s rail network, operated by Etihad Rail, has ramped up freight services during the war to shift containers away from vulnerable Gulf ports to safer eastern outlets. Saudi Arabia has also increased the capacity of its rail network and opened new freight routes for stranded goods.
Although these efforts cannot replace the bulk of cargo carried by tankers, they are already reducing pressure on supply chains. Experts believe they will now be essential insurance against future weaponization of the strait.
Backed by vast energy wealth, the Gulf countries certainly have the financial power to turn these projects into reality. Whether they can muster the political will to overcome remaining obstacles will determine whether this crisis marks the beginning of the end of the Strait of Hormuz’s grip on global energy.
Edited by: Srinivas Majumdaru