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Market Chatter: UAE New Oil Export Pipeline Through Fujairah Expected to Commence Operations in 2027

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The new West-East Pipeline project, which will double the export capacity of UAE-based state-owned energy major Abu Dhabi National Oil through Fujairah, is under construction and is expected to commence operations next year, Abu Dhabi Media Office reported Friday.

Abu Dhabi Crown Prince Sheikh Khaled bin Mohamed bin Zayed Al Nahyan asked Adnoc to accelerate delivery of the project at a meeting of the executive committee of the company's board of directors.

The pipeline is expected to boost the country's capacity to bypass the vital Strait of Hormuz conduit, responsible for nearly 20% of global oil and gas flows, Reuters reported. The Hormuz conduit has been effectively closed since the beginning of the Iran war on Fab. 28, resulting in a supply crisis.

Among the Middle East producers, only the UAE and Saudi Arabia have pipelines that help them export crude without using the Strait of Hormuz, while Oman has access to a long coastline through the Gulf of Oman. Kuwait, Iraq, Qatar, and Bahrain depend almost entirely on the strait for exports, the Reuters report said.

In addition to the new pipeline, UAE also has access to the existing Abu Dhabi Crude Oil Pipeline, also called the Habshan-Fujairah pipeline, which has a carrying capacity of up to 1.8 million barrels of oil per day, the report added.

On Friday, Brent crude rose 3.3% at $109 a barrel, while Murban crude was up 2.93% at $107.77.

has reached out to Adnoc for a comment.

(Market Chatter news is derived from conversations with market professionals globally. This information is believed to be from reliable sources but may include rumor and speculation. Accuracy is not guaranteed.)

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