Treasury Secretary Scott Bessent asserted that newly planned and rebuilt oil pipelines will render the Strait of Hormuz irrelevant within two years, a timeline that energy experts warn is highly unlikely to materialize amid ongoing regional conflicts.
The debate over the future of Middle East energy transit comes as Gulf states look to bypass maritime choke points disrupted by continuous attacks on tankers. According to CNBC, Middle East oil producers are pushing to construct new pipeline networks to reduce their heavy reliance on the Strait of Hormuz. However, analysts emphasize that these land-based routes will not eliminate the threat to regional energy exports because the infrastructure remains just as vulnerable to low-cost, asymmetric attacks that have targeted ships in the shipping lane.
### Rebuilding and Expanding Pipeline Networks
The United States is actively supporting Iraq’s efforts to rebuild a crude oil pipeline running from the northern city of Kirkuk through Syria to the Mediterranean Sea, a State Department official stated. U.S. companies are expected to participate in the construction process.
Iraq, which operates as OPEC’s second-largest producer, has faced severe disruptions because it primarily exports through the southern port city of Basra and possesses limited alternatives. According to CNBC, Iraqi production dropped by more than 50% in June to 1.9 million barrels per day, down from the 4.2 million barrels per day pumped in February prior to the onset of the U.S. and Israeli war against Iran.
Other regional producers are also scaling up alternative routes. The United Arab Emirates plans to double its export capacity outside of Hormuz by completing a second pipeline leading to the Port of Fujairah on the Gulf of Oman. Meanwhile, people close to the matter told Reuters that Saudi Arabia is considering expanding its own pipeline to the Red Sea by 2 million barrels per day.
Goldman Sachs analysts noted that these projects are among seven oil pipelines in the Middle East currently under construction or in the planning phase. According to the note, total regional pipeline capacity could exceed 14 million barrels per day by the end of 2028, representing more than 60% of the seven Gulf states’ pre-war export volume of 23 million barrels per day.
### Vulnerability of Land-Based Infrastructure
Despite the capacity expansions, experts caution that pipelines function primarily as a geopolitical hedge rather than a total replacement for maritime straits. Jennifer Li, a geopolitical analyst at the energy consulting firm Rystad, noted that while the UAE’s existing West-East pipeline to the Gulf of Oman and Saudi Arabia’s East-West pipeline to the Red Sea have served as critical relief valves, the infrastructure itself is far from secure.
In April, an Iranian strike hit a pumping station along Saudi Arabia’s Red Sea pipeline, slashing throughput by 700,000 barrels per day.
“The problem isn’t the waterway,” Bob McNally, founder of Rapidan Energy, told CNBC’s “Power Lunch”. “It’s that Iran can use weapons to attack loading facilities, pumping stations, the end stations, these terminals, and the storage units of these pipelines.”
Adding to the regional transit risks, Iran and its Houthi allies in Yemen have escalated threats against oil flows through the Red Sea. A senior Houthi political official, Mohammed al-Farah, stated that the militant group is prepared to shut down the Bab el-Mandeb Strait in coordination with Iran, according to state media reports. Sources indicated to Reuters that Tehran has specifically asked the Houthis to close the strait if the United States bombs Iranian power infrastructure.
The Bab el-Mandeb links the Red Sea to the Gulf of Aden and global markets, meaning a closure would trap millions of barrels of oil that Saudi Arabia has successfully diverted to its Yanbu export terminal.
“The importance of Yanbu to both Saudi Arabia and to the global oil market can’t be underestimated,” said Michelle Wiese Bockmann, senior maritime intelligence analyst at Windward.
