Hormuz closure pushes Iraq and UAE to expand oil pipelines

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UAE accelerates pipeline construction

Highlights

Iraq plans to raise exports through the Kurdistan-Turkey route from 220,000 to 770,000 barrels per day.
Iraqi exports have been hit harder because most crude normally moves through Hormuz.
The UAE is accelerating a Fujairah pipeline expected to double ADNOC export capacity in 2027.

According to CNBC, last week, Baghdad approved plans to speed up crude exports through the Kurdistan-Turkey pipeline network, aiming to lift shipments from about 220,000 barrels per day to 770,000 barrels per day. The route would move oil through Kurdistan to Turkey’s Mediterranean port of Ceyhan, giving Iraq a rare alternative to the Persian Gulf.

Iraq has fewer options

The situation in Iraq is especially serious because most of its oil is usually exported through Persian Gulf terminals that depend on the Strait of Hormuz. The volume of deadweight tonnage leaving Iraqi ports has virtually disappeared since the start of the war, pointing to a sharp drop in exports.

Oil accounted for 53% of Iraq’s real GDP in 2025, according to the World Bank data cited in the report. Iraq said in May that it exported only 10 million barrels through Hormuz in April, down from 93 million barrels before the war. That collapse helps explain why Baghdad is moving quickly to revive northern export routes.

Still, the alternative is not simple. The Kurdistan-Turkey route depends on coordination between Baghdad, Kurdish authorities and Turkey. Even if exports rise to 770,000 barrels per day, that would replace only part of Iraq’s lost Gulf capacity.

UAE pushes Fujairah expansion

The UAE is in a stronger position, but it is also moving quickly. Abu Dhabi is fast-tracking a new West-East pipeline to Fujairah, a port outside Hormuz on the Gulf of Oman. The project, expected in 2027, would double ADNOC’s export capacity, according to reports on the plan.

Fujairah gives the UAE an advantage over Iraq because it already has infrastructure outside the strait. But even those routes are vulnerable. Fujairah has faced drone attacks during the war, while Saudi Arabia’s East-West pipeline was also targeted in April.

The limits of bypassing Hormuz

Saudi and UAE pipelines together have an estimated 3.5 million to 5.5 million barrels per day of available capacity, according to figures cited in the report. That is far below the roughly 20 million barrels per day that moved through Hormuz before the war. UNCTAD also describes the strait as one of the world’s most critical maritime chokepoints for seaborne oil and gas trade.

For oil markets, the pipeline race may reduce the worst disruption, but it cannot fully replace Hormuz. New routes require money, time, and political agreements across borders.

For now, Brent crude is trading at about $93 a barrel, down 1.16% from the previous day, suggesting that prices have eased even as supply risks around Hormuz remain in focus.

We also reported oil rises above $97 after the new Israel-Iran exchange of strikes.

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