UAE’s post-OPEC strategy: The new oil pipeline bypassing Strait of Hormuz & what it means for India

Ajouté : 2026-05-26

[00:00:00]With Iran choking the crucial waterway straight of Hormuz, the United Arab Emirates is accelerating construction of a new pipeline that would allow a larger share of its crude exports to bypass the narrow waterway altogether. Hello and welcome to the print. I am Udit Bubna and today I will explain why the UA's upcoming Westies pipeline is important and how it fits into Abu Dhabi's posttopic strategy, whether it can reduce risk linked to the state of hormones and why the project matters for India's energy security. The Abu Dhabi National Oil Company or ADNO is fasttracking its new West pipeline which is expected to be completed by 2027.

[00:00:43]Once operational, the pipeline will double the UA's crude export capacity through Fujayra, its strategic port on the Gulf of Oman outside the street of Hormos. The timing is significant. The UA's decision to quit OPEC plus the grouping of major oil producing countries and their allies was not just about producing more oil. It was also about ensuring that it could export more oil on its own terms and with fewer geopolitical constraints. By expanding infrastructure that bypasses Hormos, Abu Dhabi wants to strengthen its ability to increase exports even during the periods of regional instability. The project could also provide major Asian buyers including India with a more secure route for crude supplies. Speaking at an Atlantic Council event last week, ADNO chief executive Sultan Aljabar highlighted why the project is important. He said, and I quote, "Energy security is no longer just about your ability to continue to produce. It is about roots, access, storage, and redundancy. Right now, too much of the world's energy still moves through too few choke points." Alja also pointed out that the UAE has been working in that direction for more than a decade. He said, and I quote, "That is exactly why the UA made the decision more than a decade ago to invest in infrastructure that bypasses the state of hormones, and it is why we moved ahead with our second pipeline in 2025. Today, it's already almost 50% complete, and we are accelerating its delivery toward 2027."

[00:02:22]Now, why is bypassing Hormuz a big deal for UAE? The straight of Hormuz is the narrow passage connecting the Persian Gulf to the Gulf of Oman and the Arabian Sea. A large share of the Gulf country's oil and gas exports passes through this route every day. The UAE has long tried to reduce this dependence. Since 2012, the UAE has operated Abu Dhabi crude oil pipeline known as ATCOP, which carries crude from the inland Habshan oil fields to FJara on the Gulf of Oman with a capacity of about 1.5 million barrels per day. The ATCO was built specifically to reduce reliance on horm. Since the eruption of the latest West Asia conflict, the pipeline has reportedly been operating at full capacity.

[00:03:11]The new Westies pipeline is essentially the next date for that strategy. Its significance has grown further following the UA's decision to leave OPEC plus in May 2026 due to dissatisfaction with the production quotas given UA's high production capacity. As Omud Shokri, energy strategist and senior visiting fellow at George Mason University in United States told the print, the main logic is clear. If the UEI wants to expand output, it also needs a more secure export route that is less exposed to hormones risk. According to Shokri, the pipeline fits into Abu Dhabi's broader strategy of expanding production and gaining export flexibility. He sees it as a part of a long-term effort to strengthen the US position in global energy markets rather than a short-term response to any single geopolitical event. Now, can this pipeline actually reduce hormones risk? The answer is yes, but only to an extent. The new pipeline will make the UA much less vulnerable to disruption in hormones. In the event of a blockade, military escalation or disruption in the shipping traffic, Abu Dhabi would still be able to move large volumes of crude through Fujira. That additional capacity would also strengthen the UA's position as one of the few Gulf producers with a substantial export route that bypasses Homos.

[00:04:35]Shri says and I quote, "Additional UA export capacity can materially reduce supply risk. It gives Abu Dhabi a stronger bypass option during Gulf crisis and can help moderate price spikes by keeping more crude flowing through Fujira. However, there is an important limitation. The straight of hormones remains critical for much of the Gulf's oil and gas trade. Countries such as Iraq and Kuwait rely heavily on hormones for crude exports while Qatar's LNG shipments and a significant share of Saudi oil exports also pass through the strait. As Shri notes, Hormuse remains essential for other producers including Iraq with Kqatar's LNG exports and part of Saudi flows. Pipelines, storage hubs and ports can also become targets during conflict. So the pipeline improves the resilience but it does not remove geopolitical risk. In other words, the project can reduce risk for the UAE but it cannot eliminate the strategic importance of hormones for the wider Gulf region. So now what does this pipeline mean for India? India imports more than 85% of its crude oil requirements and remains heavily dependent on supplies from West Asia.

[00:05:49]That means any disruption in hormones can directly affect India through higher freight cost, rising insurance premium, shipping delays and eventually higher fuel prices.

[00:06:01]Shokri believes the new pipeline could help. He says for India the project is important because it could provide Indian refiners with more reliable access to UAE crude during regional tension. The Fuja route provides a practical alternative because oil loaded from the UAE's eastern coast can enter the Arabian Sea directly without transiting hormones. According to Shoki, this could reduce shipping delays, insurance exposure and disruption risk for Indian buyers. Given India's high dependence on imported crude and its continued reliance on Gulf barrels, any additional Hormones bypass capacity strengthens India's energy security.

[00:06:40]More broadly, the pipeline reflects a larger shift in Gulf energy geopolitics.

[00:06:45]As Shukri says, and I quote, Gulf producers are trying to reduce full dependence on hormones by developing overland pipelines, alternative ports, storage hubs, and export corridors.

[00:06:55]While hormones will remain a key route for Gulf energy exports, its monopoly is gradually being reduced as producers invest in alternative infrastructure.

[00:07:04]For India and other Asian economies that are dependent on Gulf crude, this shift could prove significant. As geopolitical tensions remain elevated, the reliability of export routes matters as much as the oil flowing through them.

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