Saudi Arabia Reportedly Considering Move To Reduce Its Reliance On Hormuz Strait As Iran Seeks To Tighten Its Grip

Saudi Arabia is considering expanding its pipeline to the Red Sea to reduce its reliance on the Hormuz Strait as Iran seeks to tighten its grip on the waterway, according to a new report.

Citing five sources familiar with the matter, Reuters detailed that the move would enable the kingdom to transport more oil away from the key waterway.

It is currently able to move up to seven million barrels per day to its port of Yanbu and is in preliminary talks with some of its neighbors to expand it by another two million barrels per day.

The outlet added that it’s not clear whether the plans involve upgrading current infrastructure or building a new pipeline.

Gulf countries saw their ability to export energy and other goods severely hampered during the war as a result Iran’s blockade of the strait.

As well as Saudi Arabia, others are also considering similar measures following the war between the U.S. and Iran as Tehran claims it will control the Hormuz Strait moving forward.

One of them is the United Arab Emirates. which is seeking to completely eliminate its reliance on the waterway.

Speaking to Bloomberg in mid-June, Minister of Foreign Trade Thani Al Zeyoudi said the country is “moving toward having zero Hormuz dependency and that’s regardless of whether it’s open or not.”

“It’s going to open and we hope that will happen quickly, but we will not stop the new plan,” he added, in reference to the agreement between the U.S. and Iran to cease hostilities and reopen the key waterway.

The pipeline will double the country’s export capacity through the Fujairah port, which is located on the Gulf of Oman beyond the Strait of Hormuz. It is expected to become operational next year. The country is also expanding the ports of Dibba and Khor Fakkan, which are located just outside the strait on the Gulf of Oman coast. It will also build at least one new harbor on the same coastline, as well as rail and road networks and a third new pipeline.

The existing pipeline can carry up to 1.8 million barrels per day. The new maximum capacity would be almost double, above 3.5 million. The UAE is one of the two only countries with active pipelines allowing for substantial exports not involving tankers going through the Strait of Hormuz.

Iraq also said it is intensifying similar plans. CNBC noted earlier in June that the Iraqi cabinet approved plans to accelerate exports through its Kurdistan-Turkey pipeline network, potentially increasing shipments from about 220,000 barrels a day to some 770,000