Iraq, UAE race to replace Hormuz oil capacity as Gulf chokepoint risks grow

BAGHDAD: Iraq and the United Arab Emirates are fast-tracking plans to expand oil pipelines to offset capacity lost from the closure of the Strait of Hormuz, as new data reveals their heavy reliance on the Persian Gulf transit route.

The Iraqi cabinet last week approved plans to accelerate crude exports through the Kurdistan-Turkey pipeline network, aiming to more than triple existing shipments from 220,000 barrels per day to 770,000. The route provides an alternative passage through Kurdistan to Turkey’s Mediterranean port of Ceyhan.

The move is intended to ease pressure on Iraq’s oil-dependent economy, which the World Bank says contributed 53% to the country’s real GDP in 2025.

According to reports, Iraq’s overall exports have virtually dried up since the war began due to its geographical dependence on the Strait of Hormuz.

In a May 16 press conference, Iraq announced it had exported 10 million barrels of oil through the strait in April, sharply down from 93 million barrels before the war.

Meanwhile, Abu Dhabi is fast-tracking construction of the new West-East pipeline to the port of Fujairah as it also seeks to bypass the Hormuz chokepoint. The project, expected to come online in 2027, will double export capacity for the Abu Dhabi National Oil Co., or ADNOC.

Abu Dhabi Crown Prince Sheikh Khaled bin Mohamed bin Zayed Al Nahyan called May 15 for faster delivery of the pipeline to meet rising global energy demand. The UAE can still export oil through other terminals, easing the immediate impact of the Hormuz closure.

But existing alternatives remain vulnerable. Iran attacked Saudi Arabia’s East-West pipeline in April, and Iranian drones have also struck Fujairah, disrupting oil loading operations at its crude export terminal.

The East-West pipeline, which links processing facilities near the Persian Gulf to an export hub on the Red Sea, and the UAE pipeline to Fujairah have a combined estimated 3.5 million to 5.5 million barrels per day of available capacity, according to the International Energy Agency. Saudi Arabia said in March its pipeline is pumping 7 million barrels per day.

Still, flows remain well short of the roughly 20 million barrels of oil and petroleum products that transited the Strait of Hormuz daily before the war. Developing alternative export routes requires not only massive infrastructure investment but also time, particularly when transnational agreements are needed for pipelines crossing multiple territories.

Ship transits through Hormuz remain significantly below prewar levels. Traffic through the sea lane fell to the lowest point of the Iran war in May, according to Lloyd’s List. Vessels stuck in the Gulf risk attack by Iranian forces unless they receive Tehran’s approval to transit a designated route through the strait. They also risk U.S. sanctions if they cooperate with Iran.