FINWIRES · TerminalLIVE
FINWIRES

UAE Fast-Tracks Oil Pipeline to Bypass Hormuz, Double Export Capacity by 2027

By

The UAE is accelerating the expansion of its West-East oil pipeline to double export capacity via Fujairah by 2027, a move aimed at further reducing dependence on the Strait of Hormuz, the Abu Dhabi Media Office said in a Friday statement.

The directive came from Abu Dhabi Crown Prince Sheikh Khaled bin Mohamed bin Zayed, who ordered ADNOC to fast-track the project.

Officials say construction is already underway and could bring the pipeline online as early as next year.

The decision comes amid rising tensions with Iran, which has expanded its claimed operational control over the Strait of Hormuz and parts of the Gulf of Oman.

Iranian forces have released new maritime control maps and have been linked to attacks on regional energy infrastructure, including incidents near Fujairah, which the UAE has condemned as "economic blackmail."

The existing Abu Dhabi Crude Oil Pipeline remains central to the UAE's strategy, moving up to 1.8 million barrels per day to the Gulf of Oman coast outside the strait.

Alongside Saudi Arabia, the UAE is one of the few Gulf producers able to bypass the chokepoint at scale, while others remain heavily dependent on it.

Related Articles

Oil & Energy

Select Tankers Resume Hormuz Transit Despite Blockade Risk, Kpler Says

Select crude and liquefied petroleum gas tankers resumed transits through the Strait of Hormuz this week as Iran allowed about 30 vessels to pass under managed protocols, Kpler said Friday.Iran's semi-official Fars News Agency said Thursday Tehran approved vessel movements after Beijing requested smoother shipping access for strategic partners, according to Kpler.Kpler identified 11 vessels that crossed the strait, including five liquefied petroleum gas tankers and two Very Large Crude Carriers, while more ships may have crossed without AIS signals.Eneos said Thursday that the VLCC Eneos Endeavor successfully exited the Strait of Hormuz, becoming only the second Japanese crude carrier to clear the Gulf since late February, Kpler added.The tanker loaded about 1.2 million barrels of Kuwaiti crude and 700,000 barrels of Das crude from the UAE before it became stranded in the Gulf for over two months.Kpler said the Eneos Endeavor stopped transmitting AIS signals near Dubai on May 9, resurfaced off Muscat on May 13, and later entered the Arabian Sea after clearing the US blockade zone while signaling Kiire, Japan, as its destination.After loading Basrah Medium crude in early March, the Chinese VLCC Yuan Hua Hu cleared the Gulf on May 13 during the Xi-Trump summit in Beijing and is currently signaling Zhoushan, China, as its destination.The Yuan Hua Hu turned off AIS transmissions on May 9, resurfaced near Iran's Larak Island four days later, and later broadcasted location signals intermittently during transit.Kpler said the VLCC Agios Fanourios I reversed course near the Arabian Sea and failed to complete its voyage despite keeping AIS transmissions active throughout the journey.The tanker loaded 2 million barrels of Basrah crude for Vietnam's Nghi Son Refinery and remains anchored near Muscat after turning back earlier this week.PV OIL warned US officials that critically low inventories at Nghi Son Refinery could force the facility to halt throughput if delays continue, Kpler added, citing Reuters.

Oil & Energy

US Oil Update: Futures Rally as Trump Leaves China Without Breakthrough

Crude oil futures surged in midday trading on Friday after President Trump departed China without securing a breakthrough to end the blockade of the Strait of Hormuz, reigniting concerns that disruptions to global supplies will deepen.Front-month West Texas Intermediate crude futures rose by 3.95% to $105.17 per barrel, while Brent futures gained 3.23% to $109.12/bbl."President Trump said he does not need Hormuz reopened, although discussions with Chinese President Xi included the ongoing conflict and energy security concerns," Soojin Kim, research analyst at MUFG, said.On Friday, Trump reportedly said he didn't push President Xi to pressure Iran to open the Hormuz, offering no sign of a breakthrough in the standoff over the key chokepoint. China is the top buyer of Iranian crude.The US President reportedly said that he is losing patience with Iran. "I am not going to be much more patient. They should make a deal," Trump was quoted as saying.Chinese FM Wang Yi reportedly said Beijing believes a solution to issues in the Strait of Hormuz "lies in achieving a permanent and comprehensive ceasefire" between the US and Iran, adding that "force cannot solve problems."Iran has "no trust" in the US and is only interested in negotiating with Washington if it is serious, Iranian Foreign Minister Abbas Araghchi said on Friday, adding that Iran is prepared to return to fighting but also to pursue diplomatic solutions.Araghchi said "trust is the most important issue," while addressing reporters in New Delhi on Friday, adding that they "cannot trust Americans at all.""As a result, everything has to be precise, and everything has to be clearly defined before we can reach an agreement," Araghchi reportedly said.Liquidity Energy strategists said crude extended gains overnight on reports that little progress was made during the Trump-Xi summit toward resolving disruptions impacting Middle East energy shipments.Meanwhile, flows through the Hormuz are easing following a ship seizure near the strategic waterway.On Thursday, the United Kingdom Maritime Trade Operations Center says it received a report of a vessel being "taken by unauthorized personnel" near the UAE emirate of Fujairah. UKMTO said the ship was taken 38 nautical miles off the UAE in the Gulf of Oman, where it was anchored.China is likely to support a gradual reopening of the Strait of Hormuz, but on terms that preserve its flexibility, Kpler strategists said, adding that the closure threatens global growth, Asian energy markets and the export demand underpinning China's economy.On the supply side, the Middle East conflict has driven global oil inventories down at a record pace, and the market will remain "severely undersupplied" until October even if hostilities end next month, the International Energy Agency said on Wednesday.The IEA said that global observed oil inventories dropped by 250 million barrels in March and April, or at a rate of about 4 million barrels per day.

Oil & Energy

EMEA Oil Update: Crude Climbs 3% as Trump Warns Iran Over Hormuz Deadlock

EMEA crude futures climbed in after-hours trading on Friday after President Trump left Beijing talks with Chinese President Xi Jinping without clear progress on reopening the Strait of Hormuz and reportedly said he is losing patience with Iran.Brent crude futures rose by 3.34% to $109.25 per barrel, while Murban oil futures were up 2.62% to $107.44/bbl."Oil prices moved toward a weekly gain as the Strait of Hormuz remained effectively closed, prolonging disruptions to global energy supplies and keeping markets on edge," Soojin Kim, research analyst at MUFG, said.On Friday, Trump said he did not push President Xi to pressure Iran to open the Hormuz, offering no sign of a breakthrough in the standoff over the key chokepoint. China is the top buyer of Iranian crude.The US President reportedly said that he is losing patience with Iran. "I am not going to be much more patient. They should make a deal," Trump reportedly said."The Trump-Xi summit was held against a backdrop of a Middle East conflict that shows no signs of resolution," said Daniel Hynes, senior commodity strategist at ANZ.Chinese FM Wang Yi reportedly said Beijing believes a solution to issues in the Strait of Hormuz "lies in achieving a permanent and comprehensive ceasefire" between the US and Iran, adding that "force cannot solve problems."Iran has "no trust" in the US and is only interested in negotiating with Washington if it is serious, Iranian Foreign Minister Abbas Araqchi said on Friday, adding that Iran is prepared to return to fighting but also to pursue diplomatic solutions.Meanwhile, flows through the Hormuz are easing following a ship seizure near the strategic waterway.On Thursday, the United Kingdom Maritime Trade Operations Centre says it received a report of a vessel being "taken by unauthorized personnel" near the UAE emirate of Fujairah. UKMTO said the ship was taken 38 nautical miles off the UAE in the Gulf of Oman, where it was anchored.The US Central Command said on Friday it has redirected 75 commercial vessels and "disabled" four as part of a blockade targeting ships entering and exiting Iranian ports.On the supply front, the Middle East conflict has driven global oil inventories down at a record pace, and the market will remain "severely undersupplied" until October even if hostilities end next month, the International Energy Agency said on Wednesday.The IEA said that global observed oil inventories dropped by 250 million barrels in March and April, or at a rate of about 4 million barrels per day.OPEC also said on Wednesday that crude production among member states fell further in April and is down more than 30% since the onset of the conflict in late February. The producer group said production fell by 1.7 million b/d in April after output plunged by 7.9 million b/d in March.