A new UAE oil pipeline built to bypass the Strait of Hormuz is now about 50% complete
JAKARTA – CEO of Abu Dhabi National Oil Company (ADNOC), Sultan Ahmed Al Jaber, said on Wednesday (20/05/26) that the United Arab Emirates’ new oil pipeline project designed to bypass the Strait of Hormuz is now around 50% complete.
Al Jaber, as quoted by Reuters (20/05/26), also warned that global oil flows may require at least four months after the end of the Iran war to recover to 80% of pre-conflict levels.
Iran has largely closed the vital waterway for global oil and gas supplies to all vessels except its own since the joint US-Israeli strikes on 28 February.
The closure triggered a surge in energy prices and global inflation, while also increasing concerns over a slowdown in the world economy.
Last week, the Abu Dhabi Media Office revealed the existence of the new West-East Pipeline project. It said Crown Prince Sheikh Khaled bin Mohamed bin Zayed had instructed ADNOC to accelerate construction of the project so that export capacity through the port of Fujairah could double by 2027.
“Today, the project is nearly 50% complete, and we are accelerating its completion towards 2027,” Al Jaber said during a livestreamed Atlantic Council event. It marked one of his most extensive public statements since the war began.
“At present, too much of the world’s energy still passes through too few strategic chokepoints. That is why the UAE decided more than a decade ago to invest in infrastructure that bypasses the Strait of Hormuz,” he said.
The existing Abu Dhabi Crude Oil Pipeline (ADCOP) is currently capable of transporting up to 1.8 million barrels per day and has become crucial for the UAE to maximise exports from the Gulf of Oman coast outside the Strait of Hormuz.
Iran, which had previously attacked vessels to demonstrate control over the strait, has now expanded its definition of the Strait of Hormuz area to include the UAE’s Gulf of Oman coastline.
Meanwhile, the United States imposed a blockade on Iranian ports and briefly attempted an unsuccessful operation to reopen the route.
UAE Becomes a Target
Arab Gulf states hosting US military bases have also been affected by the conflict, even after a fragile ceasefire began on 8 April.
According to Al Jaber, the UAE became the target of more than 3,000 missiles and drones aimed at civilian infrastructure, including ADNOC facilities. Damage assessments are still ongoing, and restoring full operational capacity could take several weeks to several months.
“The UAE was attacked because of its development model,” he said.
He also warned that even if the conflict ended tomorrow, trade flows through the Strait of Hormuz would likely not fully return to normal before the first or second quarter of 2027.
“Once the world accepts that one country can hold the world’s most important shipping route hostage, then freedom of navigation as we know it will come to an end,” he said.
“If this principle is not defended today, then the next decade will be spent dealing with the consequences.”
Energy Investment
The acceleration of the pipeline project comes after the UAE officially withdrew from the Saudi Arabia-led OPEC on 1 May. The move freed the UAE from oil production quotas.
Al Jaber described the decision to leave OPEC as a “strategic and sovereign” step driven by growing global energy demand. He stressed that the decision “was not directed at any party” and “was not intended to damage relationships”.
He also warned that the global energy sector still lacks serious investment. According to him, upstream oil investment currently stands at around IDR 6,520 trillion per year, which is only sufficient to offset natural production declines.
Global spare crude oil capacity, currently around 3 million barrels per day, should be closer to 5 million barrels per day.
AI Increases Energy Demand
Al Jaber also said that developments in artificial intelligence (AI) will place significant pressure on global power grids, and that many parties underestimate how large the energy demands of the AI revolution will be.
“In many ways, the AI race is an electron race,” he said, referring to the substantial electricity requirements needed to support AI and AI-based decision-making speed during crises.
He reiterated the UAE’s commitment to making major investments in the United States. ADNOC, its international unit XRG, and renewable energy investor Masdar, which he also leads, reportedly already hold investments worth IDR 1.385 quadrillion in 19 US states.
“The UAE and the United States are not merely trading partners. We are co-investors in the economy of the next century,” he concluded. (YS/LM)
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