Disruption and response

Months of blockades and uncertainty around the Strait of Hormuz have pushed energy exporters to look for ways to bypass the key shipping lane. Iranian officials insisted the waterway would remain closed and negotiations would not resume unless the United States complied with a June framework agreement and offered compensation to Tehran for alleged violations. US President Donald Trump, however, said on Monday that the US Navy already controls the Strait of Hormuz, adding, "We've mine swept the entire strait."

The narrow waterway between Iran and Oman is one of the world's most critical oil shipping routes. Before the Iran war, it carried around 20% of global crude exports from the Persian Gulf to markets in Europe, Asia and North America. Roughly 20 million barrels of oil and petroleum products passed through the Strait daily before the conflict.

Saudi Arabia shows what is possible

The US-Iran war has placed greater importance on alternative shipping lanes through the Red Sea. Saudi Arabia is sending its crude through the East-West Pipeline from the kingdom's eastern oil fields to the Saudi Red Sea port of Yanbu, enabling it to keep up shipments to global markets by circumventing Hormuz entirely.

During April and May, Saudi cargo shipments from its Gulf coast fell from 47.5 million tons a year earlier to just 6.3 million tons, according to data from the International Monetary Fund's Portwatch platform. Over the same period, exports through the Red Sea rose from 29.6 million to 54.8 million tons. That additional 25.3 million tons replaced roughly 61% of the volume lost on the Persian Gulf side. The shift shows that the East-West Pipeline is not merely an emergency backup, but also an important tool to keep Saudi oil flowing during a Hormuz closure.

Mixed success for the UAE and others

The United Arab Emirates has had less success, despite possessing ports and pipelines specifically designed for that purpose. The UAE's ADCOP pipeline carries crude from Habshan to Fujairah, but Fujairah was attacked during the fighting and traffic through alternative ports also declined from 13.7 million to 6.3 million tons.

Meanwhile, the Houthi rebels in Yemen declared a maritime blockade on Saudi Arabia, but its impact was not immediately clear. The blockade could complicate Red Sea routes, which have become more important as Gulf states seek alternatives.

Expert views on long-term solutions

Economist Hassan Mansour suggested new pipelines (Basra-Aqaba, Basra-Oman) and Cape of Good Hope routes, but said these projects cannot solve immediate problems. Israeli Prime Minister Benjamin Netanyahu argued for alternative routes including pipelines through the Arabian Peninsula to Israeli Mediterranean ports.

Tehran-based analyst Rahman Ghahremanpour noted that Qatar, Kuwait, and Bahrain lack coastlines outside the Persian Gulf and remain dependent on Hormuz. Ghahremanpour also warned that keeping Hormuz closed too long could form a wider coalition against Tehran.

Trump's view on pipelines

President Trump said that the Strait of Hormuz would become far less important than before because of pipeline construction. Speaking about oil prices, Trump said that despite the US war with Iran, oil is at $84 to $85 a barrel today, in part because large volumes of oil are moving through the Strait of Hormuz.

"People have found other alternatives which they never thought about - Texas, Alaska, Louisiana, and other places [where energy resources are produced]. In addition, a lot of pipelines, record numbers of pipelines are being built, so I think the Hormuz Strait is not going to be quite as important as it was in the past," the US leader told reporters at the White House.