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In the Zayed National Museum sits the world’s oldest known natural pearl. It testifies that people along the Arabian Gulf coast have looked both to the sea and the land for their livelihood for at least eight thousand years. As the UAE formally announces the construction of another pipeline to bypass the Strait of Hormuz, is the war forcing a terrestrial turn?
The US and Israeli war with Iran has cut off most of the oil exports through the strait, which until March carried about 20 per cent of global production. The US’s blockade of Iran’s oil exports is intended to counter Tehran’s own obstruction.
But while some vessels slip in and out, it does not look likely that purely military operations will restore anything close to the prewar freedom of navigation. Ships remain wary of drones, missiles and mines, of high insurance costs, and the risk of getting stuck if they enter the Gulf and then fighting resumes.
Adnoc, in a project originally discussed in 2024, announced on Friday that it will expand its pipeline to Fujairah. This will double the UAE’s oil export options that avoid the strait, to 3-3.4 million barrels per day. As Adnoc’s production capacity advances to 5 million bpd and beyond, and freed from the constraints of Opec, it may need further expansion or alternative routes.
Saudi Arabia’s east-west pipeline to the Red Sea has been another critical asset, saving the world oil market from an even worse shortage. Kuwait, Qatar, Bahrain and Iraq face more hurdles, but they will no doubt also seek bypass routes through their neighbours.
Ready access to the sea
Beyond crude oil, the Gulf countries’ industrialisation since the 1970s has been predicated on ready access to the sea. Their development of oil refining, liquefied natural gas, petrochemicals, fertilisers, aluminium and other energy-intensive materials has relied on shipborne inputs such as bauxite, then products moved by sea to hungry consumers in Asia and beyond.
Similarly, Jebel Ali and the other Gulf ports bring in essential goods for residents and tourists, and items to be transhipped to such markets as Iraq, East Africa and – before the war – Iran.
Now terminals on the Saudi Red Sea coast, the UAE’s Indian Ocean frontage, Etihad Rail and other key logistical investments have kept the Gulf economy running. Before the conflict, Sharjah’s eastern port of Khor Fakkan handled 2,000 shipping containers per week. Now it tackles 50,000.
The continuing blockade and its various bypasses by pipeline, road and rail make the Gulf almost like the Caspian, an inland body of water linked to the oceans only by tenuous canals.
The balance of land and sea naturally varies between the Gulf countries. Saudi Arabia’s inland capital makes it more land-based, though its east and west coasts are key strategic assets. Bahrain, the “two seas”, is predominantly maritime.
Oman’s own dual nature is embedded in its pre-1970 name: the Sultanate of Muscat and Oman, with Muscat representing the coast, and Oman the interior. Up to 1856, the sultans had ruled a maritime empire encompassing Zanzibar and Gwadar in Pakistan.
Iran's play
Iran, meanwhile, has at various times, been a heartland of the world’s largest continental empires, its coastal fringes more of an afterthought. Yet they hold crucial trade portals. War reporting has made some of its ports – Kharg, Bushehr, Bandar Abbas, Jask, Chabahar – famous beyond the region.
The government has sought for over a decade to develop the forbidding, but strategic, southern coast, Mokran as the Iranians call it, vitally located outside the Strait of Hormuz. Like the UAE’s line to Fujairah, its pipeline to Jask was intended to bypass the strait, but has proved ineffective in the face of the wide net of the US blockade.
Iran has its own land routes, to Iraq, Turkey, across the Caspian, through Central Asia to China, or the diesel and drugs smuggled by camel and motorbike to and from Pakistan and Afghanistan. But these will never match its sea-lanes in volume and value.
Now, one of Tehran’s five negotiating points is control of the strait. Iran’s parliament says it has a mechanism to control transit and to charge a fee for “services”, dressing up the previous concept of a toll. The Revolutionary Guards have also threatened to levy tolls on undersea data cables. These proposals will no doubt be unacceptable to most of its Gulf neighbours.
Bypass projects mean that Tehran’s current stranglehold is a wasting asset. The more it seeks to exert control over passage, deciding who can pass and who not, charging tolls or demanding diplomatic gains, the more others will avoid using the strait. Major Asian countries will also support alternatives, not wanting to beg Tehran to let vital shipments through.
Not everything can circumvent the strait. LNG can only move by ship. Bulk commodities such as refined oil products, polymers, fertiliser or aluminium are expensive to transport overland. The routes to the Red Sea elevate the importance of the Suez Canal and the Bab Al Mandeb, also key chokepoints.
Nevertheless, the logic of this landward turn is that Iran’s leverage, strong today, will weaken over time. From Tehran’s point of view, it needs to come out of this crisis with something durable. Formal authority over the strait, on its own or with other countries, can only be exercised lightly or it becomes self-limiting. Iran could move urgently for the ultimate deterrent, nuclear weapons, with all the dangers that brings.
Or it could over time seek integration into a regional economic and security framework, based on mutual respect and common prosperity. That seems absurdly optimistic today. But reviving the millennia of cultural and trade connections across and up and down the Gulf is the best way to ensure lasting peace.
