Iraq and the UAE are building oil pipelines that bypass the Strait of Hormuz
Iraq and the United Arab Emirates have stepped up efforts to develop alternative oil transport routes in order to reduce their dependence on the Strait of Hormuz. These steps are linked to rising geopolitical risks in the region and potential disruptions in energy supplies. The new oil pipeline routes are intended to ensure more stable oil exports in the event that navigation through one of the world oil market’s most critical transport arteries becomes difficult.
The Iraqi government has approved the acceleration of oil exports via the Kurdistan-Turkey pipeline network, which will more than triple current supplies, from 220,000 barrels per day to 770,000. The route leads to the Mediterranean port of Ceyhan and is expected to support the country’s economy, where the oil industry accounts for more than half of GDP.
According to data from the analytical firm QuantCube Technology, Iraqi oil exports via traditional routes have plummeted due to dependence on the Strait of Hormuz. At certain times, supplies have dropped from 93 million barrels to about 10 million barrels.
“Iraq is in a much more difficult situation because we know that most, if not all, of its oil passes through the Strait of Hormuz,” QuantCube senior economist Alan Lemagnien told CNBC.
Meanwhile, the UAE is accelerating construction of the East-West pipeline to the port of Fujairah. Once operational in 2027, it is expected to double the export capacity of the Abu Dhabi National Oil Company.
Experts note that even existing alternative routes remain vulnerable to attacks and geopolitical risks. Furthermore, their combined capacity is significantly lower than the volumes that passed through the Strait of Hormuz before the situation in the region escalated.
Developing alternative routes requires both massive investment and time. Vessel transit through the strait remains significantly lower than pre-war levels: in May, traffic fell to its lowest point since the Iran-Iraq War, according to Lloyd’s List. Tankers stranded in the Gulf face the threat of attack by Iranian forces if they pass without Tehran’s approval, as well as U.S. sanctions if they cooperate with Iran.
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Earlier, Iran launched a missile strike on the Ali Al-Salem Air Base in Kuwait, where U.S. military personnel and contractors were stationed. The attack resulted in minor injuries among personnel and damage to U.S. drones. The incident occurred amid U.S. attempts to negotiate an extension of the ceasefire with Tehran.
U.S. Secretary of State Marco Rubio stated that Iran’s Supreme Leader Mojtaba Khamenei is alive and continues to interact with his inner circle, although he does so cautiously and primarily through written messages and intermediaries. Officials in Washington note that his activity has been increasing recently.
