The United States is counting on new pipelines and alternative export routes to reduce the strategic importance of the Strait of Hormuz, but energy analysts say the infrastructure needed to replace the waterway cannot be built quickly enough to eliminate the risks facing global energy markets.
Treasury Secretary Scott Bessent said the Strait could become “irrelevant” within two years, arguing that 50% to 70% of energy products normally shipped through the waterway could instead move through underground pipelines.
Energy experts strongly dispute that assessment. The Strait of Hormuz remains one of the world’s most important energy chokepoints, and the International Energy Agency’s analysis of the waterway shows that roughly 20 million barrels per day of crude oil and petroleum products passed through it in 2025.
That represented about a quarter of global seaborne oil trade. The IEA also says bypass options remain limited, particularly for countries such as Iran, Iraq, Kuwait, Qatar and Bahrain that depend heavily on the Strait for exports.
The current disruption has therefore created a difficult challenge for policymakers. Building alternative infrastructure can reduce dependence on Hormuz over time, but existing pipelines cannot replace the volumes that normally move through the waterway in the short term.
Why pipelines cannot quickly replace the Strait of Hormuz
Saudi Arabia and the United Arab Emirates already have infrastructure capable of moving some oil around the Strait. However, the available capacity is far below the volume that normally passes through Hormuz.
The U.S. Energy Information Administration’s assessment of global oil transit chokepoints estimates that Saudi Arabia’s East-West pipeline and the UAE’s existing infrastructure could provide several million barrels per day of bypass capacity. The UAE is also planning an additional pipeline designed to increase exports through Fujairah on the Gulf of Oman.
That additional infrastructure matters, but its scale is still insufficient to make the Strait irrelevant.
The UAE expects a roughly $3 billion expansion of its pipeline network to Fujairah to become operational next year. Other projects are likely to take longer. The IEA has warned that even after major projects are completed, a substantial amount of Gulf oil would still need to pass through Hormuz if regional exports return toward pre-war levels.
David Goldwyn, a former U.S. State Department special envoy and president of Goldwyn Global Strategies, described the planned pipeline expansion as only a partial solution.
He estimates that new and expanded pipelines expected over the coming years could eventually provide about 10 million to 12 million barrels per day of capacity. That would still be significantly below the roughly 20 million barrels per day that passed through the Strait before the current conflict.
Robert McNally, a former senior director for international energy at the White House and president of Rapidan Energy Group, also rejected the idea that the Strait could soon become irrelevant.
“The Strait of Hormuz is the most relevant chokepoint on the planet,” McNally said. Even with additional pipelines, he argued, the waterway would remain strategically important because regional energy infrastructure is still heavily designed around maritime exports through Hormuz.
The problem is not simply pipeline capacity. New routes would also remain exposed to geopolitical and security risks.
McNally noted that Iran has previously demonstrated an ability to target alternative energy infrastructure and export facilities. As a result, bypass pipelines can provide additional flexibility without eliminating the underlying vulnerability.
The geography of the region also makes replacement difficult. The Strait is a narrow maritime passage connecting the Persian Gulf with the Gulf of Oman and the Arabian Sea. Its location makes it the natural export route for much of the oil and gas produced in the Gulf.
The EIA notes that disruptions at major energy chokepoints can delay supplies, increase shipping costs and push global energy prices higher. In the case of Hormuz, alternative routes can move only a portion of the volumes normally transported through the waterway.
LNG and alternative routes create another problem
Oil is not the only energy commodity affected by the Strait. Liquefied natural gas creates an even more difficult problem because LNG cannot simply be redirected through an oil pipeline.
Qatar is one of the world’s largest LNG exporters, and a significant share of its shipments normally passes through Hormuz. The IEA’s Middle East energy market analysis says more than 110 billion cubic metres of LNG passed through the Strait in 2025.
The agency estimates that about 93% of Qatar’s LNG exports and 96% of the UAE’s LNG exports transited the Strait that year. There are no comparable pipeline routes capable of replacing those maritime LNG shipments.
That leaves producers and consumers exposed even if oil companies succeed in expanding crude pipelines.
Qatar has criticized the new U.S. sanctions against Iran, describing them as unilateral. The country also shares offshore drilling rights with Iran at the South Pars field, adding another layer of complexity to the region’s energy relationships.
Other Gulf producers have indicated that they will comply with the sanctions.
The Bab el-Mandeb Strait offers another potential route for some Gulf oil exports. The waterway sits between the Arabian Peninsula and the Horn of Africa and provides access to the Red Sea.
However, it carries its own security risks. Iran-backed Houthi forces in Yemen have attacked shipping in the region, and Saudi Arabia has previously faced attacks connected to the conflict.
McNally distinguishes the two chokepoints. Bab el-Mandeb can disrupt shipping and force vessels to use longer routes, he said, but Hormuz can effectively trap supplies because producers may have limited alternatives for getting oil out of the Gulf.
Iraq is also pursuing alternatives. Baghdad has discussed efforts to revive pipeline infrastructure connecting its northern oil fields with Turkey’s Mediterranean port of Ceyhan. The Reuters report on Iraq’s plans to revive the Kirkuk-Ceyhan route noted that the pipeline has faced years of operational, political and security problems.
Iraq has also discussed other possible export routes, including a pipeline connecting its southern port of Basra with Aqaba in Jordan.
Those projects could diversify regional exports, but they face their own construction, financing, political and security challenges.
The limits become particularly important when considering global natural gas markets. Unlike crude oil, LNG requires specialized liquefaction facilities, storage infrastructure and terminals. A pipeline built to transport crude cannot simply be repurposed to move LNG.
That means the world’s dependence on Hormuz extends beyond oil prices.
Consumers could face higher energy and food costs
The disruption has already increased volatility across global energy markets. Oil prices have at times moved above $100 per barrel, contributing to higher gasoline costs and increasing pressure on inflation.
The EIA’s latest Short-Term Energy Outlook has highlighted the effect of renewed attacks and reduced shipments through Hormuz, noting that Brent crude reached $105 per barrel in July.
Higher energy costs can spread well beyond gasoline.
Jet fuel prices affect airlines and travel. Diesel prices influence freight and agriculture. Natural gas affects heating and electricity markets. Fertilizer production and transportation also depend heavily on energy costs.
David Goldwyn expects elevated oil, natural gas and food prices to persist for at least the next year if the disruption continues.
The IEA has also warned that the Gulf’s importance extends into other supply chains, including fertilizer, aluminum and commodities used in healthcare and semiconductor manufacturing.
That creates a broader economic risk. Even countries that import relatively little Gulf oil can still feel the effects through global commodity markets, shipping costs and manufacturing inputs.
Renewable energy could eventually reduce some of this exposure, but analysts say it cannot provide an immediate substitute for oil and gas.
Solar and wind can replace fossil fuels in electricity generation more easily than in transportation. Heavy trucks, aircraft, industrial equipment and other applications remain difficult to electrify quickly.
Goldwyn therefore expects renewable investment to accelerate because governments increasingly view energy independence as a security priority. However, he argues that those investments will not eliminate exposure to fossil-fuel prices over the next several years.
The underlying issue is timing.
Pipelines can diversify supply routes and reduce vulnerability. They cannot be designed, financed, constructed and brought into operation quickly enough to replace the Strait’s role during an immediate crisis.
Even completed pipelines would not guarantee security if regional energy infrastructure remains vulnerable to attack.
The result is a gap between the long-term goal of reducing dependence on Hormuz and the short-term reality of a global energy system that still relies heavily on the waterway.
Accurate information about how much oil is currently moving through the Strait is also difficult to obtain. Some tanker operators have disabled automatic identification system transponders because of security concerns, while restrictions on commercial satellite imagery have made independent monitoring more difficult.
That uncertainty makes the market’s response harder to predict. For consumers, however, the central problem remains straightforward: alternative infrastructure may eventually reduce the importance of the Strait, but energy analysts say it cannot make Hormuz irrelevant anytime soon.
