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Oil Crashes 9% as Trump and Vance Blame Iran War for Midterm Rout
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The leading economics blog online covering financial issues, geopolitics and trading.
The United Arab Emirates currently operates one crude export pipeline that bypasses the Strait of Hormuz and announced earlier this year that it was building a second. A third pipeline is reportedly being planned to further expand crude capacity and reroute energy flows around Hormuz, reducing exposure to Iranian disruption and weakening Tehran's leverage over the critical maritime chokepoint.
Bloomberg reported Wednesday morning that Abu Dhabi’s state-owned energy giant, Abu Dhabi National Oil Co., is weighing plans for a third pipeline from the UAE’s western coast to Fujairah on its eastern coast that could supply Asian customers and bypass Hormuz.
"Adnoc has been telling some customers in Asia about the pipeline, other people familiar with the matter said. The plans haven’t been finalized and could still change, including the route, a number of the people said," the outlet reported.
The new pipeline would build on the UAE's existing pipeline, which has operated since 2012 and stretches 252 miles from Habshan in Abu Dhabi to Fujairah on the Gulf of Oman. That pipeline has a capacity of 1.5 million barrels a day, expandable to 1.8 million.
Earlier this year, the UAE announced the West-East Pipeline, expected to begin operations in 2027 and double export capacity through Fujairah.
Notably, Fujairah sits outside the Hormuz chokepoint, allowing tankers to load crude without entering the Persian Gulf.
An ADNOC spokesperson responded to the outlet's request for comment: “We have advised Bloomberg that this report is not accurate and purely speculative.”
Beyond the UAE, the biggest story of the year has been other US-allied Gulf countries expanding pipeline routes around Hormuz, including Saudi Arabia, while Kuwait is proposing new pipelines. Taken together, these projects could erode Iran's leverage over Gulf flows, which has also clearly carried into US politics, with a Democratic sweep in the midterms.
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