Quick Summary: UAE and Iraq Pipelines Challenge Iran’s Control Over Gulf Oil Routes
- Iran’s tactics in the Strait of Hormuz are prompting accelerated pipeline projects — this could weaken Iran’s grip on Gulf oil exports.
- Goldman Sachs projects 45% of Persian Gulf exports could bypass Hormuz by 2027 — rising to over 60% by 2028.
- The U.S. demands Iran guarantee safe passage through Hormuz — tensions remain high with recent attacks on shipping.
- Oil prices surged over 9% after Trump’s remarks on a potential blockade — Brent crude rose to $86.57 a barrel.
- New pipelines like UAE’s West-East and Iraq’s Basra-Haditha are under construction — could reshape West Asia’s oil trade.
Source: Open external resource
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Iran’s aggressive maneuvers in the Strait of Hormuz are not just a geopolitical chess move; they are a high-stakes gamble that may backfire. Tehran’s short-term strategy of disrupting oil flow to hike prices might soon undermine its own long-term influence. Irans is at the center of this development.
As Iran continues to rattle the Strait, the world is responding not just with military posturing but with strategic infrastructure projects designed to sidestep Hormuz entirely. Goldman Sachs estimates that by 2027, nearly half of the Persian Gulf’s oil exports could bypass the strait, rising to 60% by 2028. This shift could permanently dilute Iran’s leverage over global oil markets.
The immediate stakes are high. The U.S. has demanded Iran ensure safe passage, while recent attacks have reignited military tensions. Meanwhile, oil markets are jittery, with prices spiking after President Trump’s comments about a potential blockade and cargo fees.
The real game-changer, however, lies in the commercial realm. New pipelines like the UAE’s West-East and Iraq’s Basra-Haditha are already under construction, promising a future where Iran’s control over Hormuz is less consequential. This structural shift in the oil trade could redefine power dynamics in West Asia.
In the end, Iran’s strategy might have inadvertently accelerated its own marginalization. By proving it can still disrupt markets, Tehran may have unwittingly encouraged its rivals and customers to engineer alternatives, potentially altering the geopolitical landscape for decades to come.
57 a barrel after having fallen below $70 when the ceasefire was first announced. But Goldman estimates, as reported this week, that by the end of 2027 enough bypass capacity could shield more than 45% of pre-war Persian Gulf export levels from future Hormuz disruptions, rising to more than 60% by the end of 2028.
officials publicly demanded an Iranian statement guaranteeing safe passage, while AP said Iranian Foreign Minister Abbas Araghchi planned talks in Oman on Saturday, July 11. Energy Information Administration data cited by the Council on Foreign Relations, equal to roughly one-fifth of the world’s oil and gas supply.
Even then, 7 million to 9 million barrels a day would still remain exposed, which is why the market is treating this as a major but not complete strategic shift. strikes, and Trump publicly floated both a revived blockade and a 20% cargo charge.
On July 8, according to CFR’s roundup of the latest developments, the truce collapsed. Meanwhile, Gulf leaders were scrambling diplomatically: AP reported that UAE President Sheikh Mohammed bin Zayed Al Nahyan traveled to Kuwait after the Iranian attack, and Qatar’s foreign minister remained involved in mediation alongside Pakistan.
Axios, citing Bloomberg Intelligence and Goldman Sachs analysis, reports the market’s biggest players are already “scrambling to bypass the waterway,” turning a military confrontation into a structural remapping of the West Asia oil trade. military supported vessels using a southern route along Oman’s coast.
officials publicly demanded an Iranian statement guaranteeing safe passage, while AP said Iranian Foreign Minister Abbas Araghchi planned talks in Oman on Saturday, July 11. Goldman Sachs projects 45% of Persian Gulf exports could bypass Hormuz by 2027 — rising to over 60% by 2028.
Goldman Sachs estimates that by 2027, nearly half of the Persian Gulf’s oil exports could bypass the strait, rising to 60% by 2028. Even then, 7 million to 9 million barrels a day would still remain exposed, which is why the market is treating this as a major but not complete strategic shift.
strikes, and Trump publicly floated both a revived blockade and a 20% cargo charge. On July 8, according to CFR’s roundup of the latest developments, the truce collapsed.
Meanwhile, Gulf leaders were scrambling diplomatically: AP reported that UAE President Sheikh Mohammed bin Zayed Al Nahyan traveled to Kuwait after the Iranian attack, and Qatar’s foreign minister remained involved in mediation alongside Pakistan. As Iran continues to rattle the Strait, the world is responding not just with military posturing but with strategic infrastructure projects designed to sidestep Hormuz entirely.
The scale and speed of this development has caught many observers off guard. Each new update adds another dimension to a story that is still unfolding, and the full picture will only become clear as more verified details emerge from the people and institutions directly involved.
Analysts who have tracked this issue closely say the current moment represents a genuine turning point. The decisions made in the coming weeks are expected to set the direction for months ahead, with ripple effects likely to extend well beyond the immediate actors in the story.
For those directly affected, the practical impact is already visible. People navigating this fast-changing situation are dealing with real consequences while new information continues to reshape what is known and what remains open to interpretation.
Historical parallels offer some context, though experts caution against drawing too close a comparison. Similar situations have played out before, but the specific combination of pressures, personalities, and timing here makes this moment distinct in ways that matter for how it ultimately resolves.
The political and economic dimensions of this story are deeply intertwined. What appears as a single event on the surface is in practice the convergence of multiple pressures that have been building quietly over a longer period than most public reporting has captured.