Sultan Ahmed Al Jaber, chief executive of Abu Dhabi National Oil Co., said Wednesday that the United Arab Emirates’ new crude-oil pipeline designed to bypass the Strait of Hormuz is now nearly 50% complete, underscoring how the Iran conflict is permanently reshaping global energy infrastructure and oil-export routes.

Speaking during a live-streamed event hosted by the Atlantic Council in Washington, Al Jaber said the so-called West-East Pipeline — designed to expand UAE crude exports through the port of Fujairah on the Gulf of Oman — is being accelerated toward completion in 2027.

“Today, it’s already almost 50% complete, and we are accelerating its delivery toward 2027,” Al Jaber said.

According to the Abu Dhabi Media Office, UAE Crown Prince Sheikh Khaled bin Mohamed bin Zayed Al Nahyan directed ADNOC to fast-track the project following the worsening regional energy crisis triggered by the Iran war.

The announcement carries major implications for global oil markets because Iran has effectively kept the Strait of Hormuz closed to most non-Iranian shipping since U.S. and Israeli strikes launched on Feb. 28.

The Strait historically handled roughly 20% of global seaborne crude shipments, making it the single most important oil chokepoint in the world.

Al Jaber described the disruption as “the most severe energy supply disruption in history.”

According to the ADNOC chief, more than 1 billion barrels of oil supply have already been lost because of the closure, with nearly 100 million additional barrels disrupted every week the strait remains inaccessible.

He also warned that even if the conflict ended immediately, global oil flows would not normalize quickly.

Al Jaber estimated it would take at least four months for shipping volumes through Hormuz to recover to roughly 80% of prewar levels, while full normalization may not occur until sometime in 2027.

“Once you accept that a single country can hold the world’s most important waterway hostage, freedom of navigation as we know it is just finished,” he said. “If we don’t defend this principle today, we will spend the next decade defending against the consequences.”

The business implications stretch across the global energy system.

ADNOC’s existing Abu Dhabi Crude Oil Pipeline already transports up to 1.8 million barrels per day from inland oil fields directly to Fujairah, bypassing Hormuz entirely. The new West-East Pipeline is designed to roughly double that export capacity.

That increase would effectively add export flexibility equivalent to the total production of a mid-sized OPEC member nation.

For commodity traders including Vitol, Trafigura, and Glencore, as well as oil majors such as Exxon Mobil Corp., Chevron Corp., and ConocoPhillips, the project significantly changes the long-term geopolitical risk profile attached to Gulf crude.

Infrastructure that bypasses Iran’s naval reach effectively lowers future supply-disruption risk premiums built into oil prices.

The project also follows another major strategic shift by the UAE.

Al Jaber confirmed during the same event that the UAE formally exited the Organization of the Petroleum Exporting Countries on May 1, ending decades of participation in the Saudi-led oil cartel.

He described the decision as a sovereign strategic move reflecting what he called the world’s growing need for additional energy supply.

Without OPEC production quotas, the UAE can now increase output based entirely on its infrastructure capacity — making the pipeline expansion central to the country’s future energy strategy.

Oil prices remain elevated despite easing modestly from spring highs.

West Texas Intermediate crude traded near $98.96 per barrel Wednesday afternoon, while Brent crude remained near similar levels. Prices have stabilized somewhat in recent weeks as traders increasingly price in alternative Gulf export routes, expanding Saudi pipeline capacity, and additional U.S. shale production.

For American consumers, the implications are immediate.

Every additional barrel of Gulf oil that can reach global markets without transiting Hormuz helps reduce the geopolitical risk premium embedded in gasoline, diesel, and jet-fuel prices.

U.S. gasoline prices have remained above roughly $4.10 per gallon through much of the spring, pressuring household budgets and weighing on discretionary spending.

Airlines including Delta Air Lines Inc., United Airlines Holdings Inc., and American Airlines Group Inc. have cited elevated fuel expenses in recent earnings reports, while logistics and transportation companies including FedEx Corp., United Parcel Service Inc., Old Dominion Freight Line Inc., and J.B. Hunt Transport Services Inc. continue facing higher operating costs.

The pipeline expansion also carries major implications for energy infrastructure investors.

Pipeline operators, storage companies, and export-terminal businesses tied to Gulf energy logistics are expected to benefit from long-term rerouting of oil and natural-gas flows.

U.S. liquefied-natural-gas exporters including Cheniere Energy Inc., Sempra, and Venture Global LNG have also gained market share as European and Asian buyers diversify away from shipping routes exposed to Iranian disruption.

Meanwhile, defense contractors including Lockheed Martin Corp., RTX Corp., Northrop Grumman Corp., General Dynamics Corp., and L3Harris Technologies Inc. continue benefiting from expanded Gulf maritime-security spending tied to the conflict.

The broader geopolitical situation remains unresolved.

President Donald Trump said earlier this week that he postponed a planned military strike against Iran while diplomatic negotiations continue, temporarily easing fears of immediate escalation but doing little to reopen the strait itself.

Secretary of State Marco Rubio and National Security Adviser Mike Waltz continue coordinating with Gulf allies including the UAE and Saudi Arabia regarding maritime-security responses.

The U.S. Fifth Fleet, headquartered in Bahrain, continues escorting limited commercial traffic outside the strait, though insurance markets remain highly restrictive for vessels attempting passage through the area.

The economic effects have spread far beyond energy markets.

The International Energy Agency has warned that prolonged Hormuz disruption could reduce global GDP growth during 2026, while the International Monetary Fund recently raised its inflation forecasts partly because of sustained energy-price pressures tied to the conflict.

Minutes released Wednesday from the Federal Reserve’s latest policy meeting also reflected continued concern among policymakers regarding energy-driven inflation risks.

Al Jaber argued the crisis demonstrates a broader structural vulnerability within the global energy system.

“Right now, too much of the world’s energy still moves through too few chokepoints,” he said.

That logic is already influencing infrastructure planning across the Gulf region.

Saudi Arabia is studying additional expansion of its East-West Pipeline linking eastern oil fields to the Red Sea. Iraq is revisiting dormant export routes through Turkey and Jordan. Oman is positioning its Duqm port on the Arabian Sea as a future regional export hub outside the Strait of Hormuz entirely.

For the UAE, the pipeline is more than an industrial project.

It is a strategic declaration that the country no longer intends to let its economic future depend entirely on stability inside the Persian Gulf.

For global markets, it represents one of the first major pieces of physical infrastructure being built specifically to reduce the long-term financial cost of Gulf instability.

Every mile of pipeline completed between Abu Dhabi and Fujairah slightly changes the global energy equation.

— JBizNews Desk

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