Bypassing Hormuz Chokepoint
U.S. Officials Predict Pipelines Will Bypass Strait of Hormuz Within Two Years
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Key Points
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The UAE's West-East crude oil pipeline expansion will double export capacity through Fujairah by 2027, part of a broader push to route oil around the Strait of Hormuz via pipelines through Saudi Arabia, Iraq, Syria and Turkey.
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Oil transit through the Strait of Hormuz has slowed dramatically, with only five vessels clearing the strait on a recent day, far below the pre-war average of about 120.
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WorldIsraelNews reported that Bessent described Hormuz as becoming a worthless waterway, with oil moving over land.
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The U.S. is signaling continued pressure on Iran, including plans to sanction more Iran-linked banks to isolate the regime’s economy and de-risk energy supplies globally.
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U.S. Central Command said it launched strikes against IRGC targets in Iran around 12 p.m. ET in response to attacks on vessels in Hormuz, illustrating ongoing conflict-driven market volatility.
US Treasury Secretary Scott Bessent declared that the Strait of Hormuz will become "worthless" within two years as oil pipelines bypass the contested waterway Mediaite. The prediction reflects a major shift in global energy strategy, with Gulf producers accelerating pipeline projects to reroute crude oil around the strategic chokepoint amid escalating US-Iran tensions and vessel attacks.
Recent data shows the shift is already underway. Only five vessels cleared the Strait on a recent day, down sharply from the pre-war average of about 120 TheHill. The UAE's West-East crude oil pipeline expansion will double export capacity through Fujairah by 2027, routing oil overland through Saudi Arabia, Iraq, Syria, and Turkey TheHill.
Pipeline Boom Replaces Maritime Route
Gulf oil producers are racing to build and expand land-based pipelines to dodge Hormuz entirely. The UAE's West-East pipeline project will double crude export capacity through the port of Fujairah by 2027 TheHill. Saudi Arabia, Iraq, Syria, and Turkey are all part of the new corridor network, creating a land route that bypasses the contested waterway entirely TheHill.
This infrastructure shift reflects years of vulnerability. The Strait of Hormuz has long been a chokepoint where about 20% of the world's oil passes through a narrow stretch of water. Pipeline diversification removes that geographic risk and gives producers direct control over their export routes TheHill.
Vessel Traffic Collapses as Attacks Surge
Shipping through Hormuz has cratered. A recent day saw only five vessels transit the Strait, compared to roughly 120 daily before the conflict escalated TheHill. Attacks on commercial ships and US military strikes have made the route too risky and unpredictable for most traders, accelerating the shift to overland pipelines TheHill.
US Central Command launched strikes against Iranian Revolutionary Guard Corps targets around noon ET in response to the vessel attacks, signaling Washington's determination to keep pressure on Iran TheHill. The ongoing conflict is driving both oil-price volatility and the economic logic for pipelines that avoid the danger zone entirely TheHill.
Washington Isolates Iran's Economy Further
The US is doubling down on sanctions as part of its strategy to isolate Iran and de-risk global energy supplies. Treasury officials are planning to sanction more Iran-linked banks, tightening the economic noose around the regime Mediaite. Bessent's two-year Hormuz prediction aligns with this broader pressure campaign.
By making the Strait strategically irrelevant, Washington aims to remove Iran's leverage over global oil markets and eliminate one of the regime's key economic chokepoints. Pipeline infrastructure removes Tehran's ability to threaten shipping, undercutting one of its few remaining geopolitical tools TheHill.
Timeline and Market Implications
Bessent's two-year window is ambitious but reflects real infrastructure timelines. The UAE pipeline expansion targets 2027 completion, and other corridor projects are advancing similarly TheHill. If even half of Hormuz traffic reroutes to pipelines by then, the waterway loses most of its strategic relevance TheHill.
Energy markets remain vulnerable to conflict disruptions in the near term. Analyst consensus suggests that while Hormuz's importance will decline, the global oil market will stay responsive to Middle East tensions and infrastructure developments for years TheHill. The real test comes when pipelines actually carry the volume Bessent predicts TheHill.
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