New pipeline projects highlight the vulnerability of Gulf energy flows as war disrupts one of the world’s most critical shipping chokepoints
MARKET INSIDER – The closure of the Strait of Hormuz is rapidly reshaping global energy infrastructure, forcing major oil producers to accelerate alternative export routes in a race to protect billions of dollars in revenue and prevent further disruptions to global oil markets. Iraq and the United Arab Emirates are now fast-tracking strategic pipeline projects as the conflict surrounding Iran threatens one of the world’s most important energy arteries.
The urgency reflects a stark reality: before the conflict, roughly 20 million barrels of oil and petroleum products moved through the Strait of Hormuz every day, making it one of the most critical chokepoints in the global economy. As vessel traffic remains well below pre-war levels, oil-exporting nations are scrambling to reduce their dependence on a maritime corridor that has become increasingly vulnerable to military attacks, sanctions risks, and geopolitical brinkmanship.
Iraq appears to be among the hardest-hit countries. New data from QuantCube Technology shows Iraqi exports have nearly collapsed since the conflict began due to the country’s overwhelming reliance on Hormuz. Baghdad recently approved plans to accelerate crude shipments through the Kurdistan-Turkey pipeline system, boosting capacity from approximately 220,000 barrels per day to 770,000 barrels per day. The route would allow Iraqi crude to reach Turkey’s Mediterranean port of Ceyhan, offering a critical alternative lifeline for an economy where oil accounted for more than half of GDP in 2025, according to World Bank data.
The scale of the disruption is already visible. Iraqi officials reported exports of just 10 million barrels through Hormuz in April, a dramatic decline from the 93 million barrels shipped before the conflict. According to QuantCube senior economist Alan Lemangnen, Iraq faces a far more difficult challenge than many of its Gulf neighbors because it lacks significant alternative routes for redirecting exports away from the strait.
The UAE is also moving aggressively to strengthen its energy resilience. Abu Dhabi has accelerated construction of its new West-East pipeline connecting oil fields to the export hub of Fujairah on the Gulf of Oman. The project, expected to become operational in 2027, is designed to double the export capacity of the Abu Dhabi National Oil Company (ADNOC) while reducing dependence on Hormuz. Crown Prince Sheikh Khaled bin Mohamed bin Zayed Al Nahyan has publicly called for faster completion of the project to meet growing global energy demand.
Yet even these alternatives are far from immune to regional instability. Saudi Arabia’s East-West pipeline reportedly came under attack earlier this year, while Iran-linked drone strikes have disrupted operations at Fujairah, highlighting how infrastructure designed to bypass Hormuz can still become a target during periods of escalating conflict. Combined spare capacity across Saudi and Emirati alternative routes remains significantly below the volumes that traditionally flowed through Hormuz, underscoring the difficulty of replacing the strategic waterway.
The broader lesson for investors and policymakers extends beyond the Middle East. The crisis is accelerating a global reassessment of energy security, supply-chain resilience, and infrastructure diversification. While oil markets have long understood the strategic importance of Hormuz, the current disruption demonstrates that building alternatives takes years, not months. The countries that emerge strongest from this crisis may not be those with the largest reserves, but those capable of creating the most resilient routes to market—a shift that could redefine energy geopolitics for the next decade.
