Gulf Nations Push Pipelines and Port to Bypass Hormuz

Gulf producers are racing billion-dollar projects to bypass Hormuz after months of tanker attacks and threats of tolls. Oil exporters in the Persian Gulf are advancing new pipelines and a major east-coast port so more crude and cargo can move without the narrow waterway that once carried about 20 percent of the world’s oil.

According to reporting this week, the United Arab Emirates, Iraq, and Saudi Arabia are accelerating overland routes as the regional conflict stretches into its fifth month. Iran has repeatedly targeted shipping and has insisted it will impose tolls that could cost tens of billions of dollars; in some cases, protection payments of millions of dollars per tanker have been reported.

The UAE’s West-East Pipeline project is about 50 percent complete. Crown Prince Sheikh Khaled bin Mohamed bin Zayed has ordered completion by 2027. A parallel line would roughly double overland capacity toward Fujairah on the Gulf of Oman, with estimates pointing to roughly 3 to 3.6 million barrels a day once finished. DP World is in talks to build a new multipurpose port and container terminal in Fujairah, plus expand the existing harbor, reducing reliance on Dubai’s Jebel Ali hub inside the Gulf. Saudi Arabia is considering expanding its Red Sea crude pipeline capacity toward 9 million barrels per day and has held preliminary talks with neighbors. Iraq is advancing the 435-mile Basra-Haditha pipeline, approved in 2024, though no firm completion date has been set.

Goldman Sachs analyst Alexandra Paulus told investors that pipeline capacity should be enough to divert up to 45 percent of pre-war Persian Gulf oil exports by the end of 2027. The bank estimates output bypassing the strait could reach 7.3 million barrels a day by the end of 2028—making about 60 percent of the Gulf’s oil “strait-proof.” Abu Dhabi National Oil Company chief Sultan Al Jaber has said the conflict confirmed the value of infrastructure that avoids choke points.

How much Gulf oil could soon leave without the Strait of Hormuz?

The pipeline and port push makes a large share of Gulf crude less dependent on a single maritime chokepoint. If Goldman’s timeline holds, nearly half of pre-war export volumes could have an overland or east-coast option by late 2027, rising toward three-fifths by 2028. That would give producers more flexibility when tanker availability tightens and could ease pressure on global supply during future disruptions.

Obstacles remain. Distance between existing fields and new terminals adds cost and complexity. Fujairah still needs major infrastructure upgrades to rival Jebel Ali. Iraq’s longer cross-border pipeline lacks an agreed schedule. Saudi Red Sea capacity does not yet cover all of the kingdom’s exports, and Qatar’s LNG terminals sit inside the Gulf, so every cargo still must transit Hormuz. Pipelines themselves can be targeted, as earlier damage to Saudi’s East-West line showed. Data that would help evaluate progress include monthly bypass volumes versus total Gulf exports, construction milestones on the UAE parallel line and Fujairah port, and Iraq’s final timeline.

Even partial success would diversify routes that the world has long treated as irreplaceable. Readers should watch completion rates through 2027 and whether Saudi and Iraqi projects firm up—signals that more energy can move without one vulnerable strait.

Source: New York Post reporting on Gulf pipeline and port plans (July 14, 2026), drawing on Goldman Sachs analysis and Financial Times coverage of DP World’s Fujairah plans.