Middle East Oil Pipeline Infrastructure Emerges as Strategic Alternative to Strait of Hormuz

Iran’s blockade of the Strait of Hormuz has now extended beyond four weeks, presenting significant challenges to global energy markets and prompting Gulf states to reconsider their long-term infrastructure strategies. The waterway, which ordinarily facilitates the transit of more than 20 million barrels of oil and liquefied natural gas daily, remains effectively closed to most commercial vessels, forcing storage tankers to capacity whilst international powers debate military intervention.

Donald Trump has signalled consideration of ground troop deployment to reopen the critical choke point, whilst simultaneously criticising European allies for their reluctance to participate in coordinated military action. Against this backdrop, Gulf states are evaluating whether substantial investment in pipeline networks represents a prudent hedge against future transit vulnerabilities.

Saudi Arabia has relied extensively on its East-West pipeline, a 745-mile infrastructure asset constructed during the 1980s following Iraq’s invasion of Iran. The pipeline connects the Abqaiq oil field in the Eastern Province to the Red Sea port of Yanbu, originally comprising two separate conduits, one of which previously transported gas liquids. Shipping data from Vortex indicates that Yanbu loaded as many as 4.6 million barrels per day during late March, representing more than triple the 2025 average. Amin Nasser, chief executive of state-owned Aramco, confirmed the pipeline serves as the company’s primary export route during the current crisis.

Maisoon Kafafy, senior adviser to the Atlantic Council’s Middle East programmes, observed that interest in alternative corridors has undergone a qualitative transformation. Whilst such routes were previously discussed in theoretical terms, current deliberations focus on viability assessments, implementation timelines, and cost structures.

The United Arab Emirates operates an existing pipeline connecting the Habshan oilfield in Abu Dhabi to the eastern coast of Fujairah. Plans to extend this infrastructure by 186 miles from the western port of Jebel Dhanna to Fujairah would enable up to 1.5 million barrels daily to circumvent the strait. A Chinese state-owned contractor manages substantial portions of this project, which was initially scheduled for completion in 2026 with operations commencing in 2027. Jamie Ingram, analyst and managing editor of the Middle East Economic Survey, noted that work continues but acknowledged potential delays given recent developments.

Gulf producers demonstrate a clear preference for eastern routing, given that Asian markets represent their core demand centres and future growth prospects. Directing crude westward presents logistical inefficiencies, though current circumstances may necessitate such arrangements.

The India-Middle East-Europe Economic Corridor, initially proposed by President Joe Biden alongside Indian Prime Minister Narendra Modi in September 2023, has emerged as a potential revival candidate. The IMEC framework envisaged connectivity through Israel to the Mediterranean, though Hamas’s October 2023 attack on Israel created substantial political complications. Central to any revival would be securing Saudi Arabian agreement for pipeline or rail transit to the Israeli port of Haifa, a particularly challenging prospect given that Riyadh has never established formal diplomatic relations with Israel and continues to withhold recognition of Israeli sovereignty.

Joseph Rozen, senior fellow at the Jerusalem-based Misgav Institute for National Security, advocates for Israeli and Jordanian participation in IMEC. He characterised the corridor as substantially based on regional transportation concepts originally presented by Israel Katz, currently serving as defence minister. Rozen suggests that normalisation could proceed gradually through working groups focused on energy, technology, and trade connectivity, generating de facto diplomatic progress without ceremonial political burden.

The current conflict with Iran has reportedly drawn regional powers into closer alignment, with some media sources suggesting that Saudi Arabia privately supports continued US military engagement despite formal advocacy for de-escalation. The kingdom faces direct security concerns from Houthi forces positioned along its borders.

Ingram expressed scepticism regarding near-term IMEC revival, citing domestic political risks for Saudi Arabia in engaging with Israel during ongoing conflict. Alternative routing through Oman emerged in discussions, though such plans face significant terrain challenges. The sultanate has historically served as a regional mediator, most recently facilitating US-Iran dialogue in February 2025. Iran announced this week that it is drafting a joint protocol with Oman to oversee Strait of Hormuz transit and issue permits, though Muscat has not yet responded formally.

Iraq’s proposed oil pipeline to the Jordanian port of Aqaba has experienced delays owing to proximity concerns with Israel. The two-segment project would transport crude from Basra to Haditha before continuing to Aqaba, though security risks and opposition from certain Shia Muslim factions present obstacles. Additional cross-border pipeline proposals spanning routes through Jordan, Syria, or Turkey could require investments ranging from 15 billion to 20 billion US dollars, according to Financial Times reporting.

Ashley Kelty, analyst at UK investment bank Panmure Liberum, highlighted inherent complications in cross-border pipeline projects. Whilst domestic infrastructure typically proceeds smoothly, international ventures frequently encounter disputes over financial responsibility, profit allocation, and maintenance obligations. The Iraq-Turkey crude oil pipeline exemplifies such difficulties, having been shut down for more than two years following an administrative court ruling and experiencing protracted financial disputes. Turkey terminated its agreement to permit oil transit from Iraq’s Kurdish region in July 2025, with the arrangement set to expire on 27 July 2026. The Strait of Hormuz closure prompted Iraq to negotiate a resumption deal with the Kurdistan regional government, achieving 250,000 barrels per day throughput to Ceyhan by mid-March.

Kelty noted that Donald Trump’s administration may resist engagement with Biden-era initiatives, whilst recent developments in Venezuela have strengthened rather than weakened US energy security positioning. Security considerations weigh heavily on any pipeline planning, given that Iranian missile and drone attacks currently target ports and gas facilities throughout the Gulf region with notable frequency. The Houthis’ previous disruption of Red Sea shipping demonstrates that alternative maritime routes offer no guaranteed security.

The extended closure of the Strait of Hormuz has fundamentally altered regional strategic calculations. Market participants had generally assumed that any closure would prove brief and manageable; the rapidity with which conditions deteriorated and the duration of the blockade have prompted a reassessment of contingency planning across Gulf energy producers.