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As the Strait of Hormuz is blocked, the lifeline of the global oil market relies on two pipelines. These are currently the only significant alternative channels for Middle Eastern crude oil to enter the international market, and their operational status affects the global energy supply.
The two pipelines are: the East-West Pipeline of Saudi Arabia, which transports crude oil westward to the Red Sea port of Yanbu; and the Habshan–Fujairah pipeline in the UAE, which bypasses the Strait of Hormuz to reach the port of Fujairah.
Amin Nasser, CEO of Saudi Aramco, stated on Tuesday that this is the biggest crisis the oil and gas industry in the region has faced to date, and the company expects to push the throughput of the East-West Pipeline to an average of 7 million barrels per day within a few days, of which about 5 million barrels can flow to the international market, with the remainder supplied to domestic refineries in Saudi Arabia.
According to IEA data, the Habshan–Fujairah pipeline in the UAE has a maximum throughput capacity of about 1.8 million barrels per day, and before the conflict, it was operating at about 1.1 million barrels per day.
However, this &#34;lifeline&#34; also comes with new vulnerabilities. The East-West Pipeline of Saudi Arabia has never operated at full capacity over a long period. Analysts warn that Iran may shift its attack targets from the Strait to land pipelines and ports, and the port of Fujairah was damaged last week in an unsuccessful drone attack.
<h2>The volume of tankers passing through the Strait of Hormuz remains extremely low, with at least 25 tankers rerouted to the Red Sea</h2>
A previous article by Wall Street Insight pointed out that, according to a daily tracking report released by Morgan Stanley on March 10, only 3 oil and refined oil tankers exited the Persian Gulf through the Strait of Hormuz on that day, with zero LNG and LPG vessels transiting, while the normal level is about 35 vessels, indicating that traffic remains extremely low.
However, the data from Goldman Sachs differs from that of Morgan Stanley. According to a report cited by the Wall Street Journal, the oil flow through the Strait of Hormuz slightly increased on Monday, with the number of vessels returning to 20% of the pre-conflict daily flow.
Goldman Sachs cautioned that the data may be volatile, and due to vessels turning off their transponders to evade detection, tanker traffic has become difficult to track.
Meanwhile, the East-West Pipeline of Saudi Aramco is about to reach its daily capacity limit of 7 million barrels, and the export volume from Fujairah in the UAE has surged by 45% in a single month, with 25 tankers rerouted to the Red Sea port of Yanbu for redeployment.
<h2>The two pipelines are the &#34;only scalable alternatives,&#34; but they can only alleviate rather than fill the gap</h2>
In the context of disruptions in the Strait of Hormuz, the Saudi East-West Pipeline and the UAE's Habshan to Fujairah Pipeline are regarded as the only two routes that can allow &#34;significant volumes&#34; of crude oil to bypass the strait and enter the international market.
However, the pipelines cannot cover all the volumes that have been cut off. The IEA points out that Saudi Aramco still has 800,000 barrels of refined oil per day that need to pass through the strait and cannot be rerouted. Additionally, there are issues with crude oil being stranded from Kuwait, Iraq, and Bahrain.
Calculations by Sparta Commodities show that even if both pipelines operate at full capacity, approximately 10 million barrels of crude oil may still be trapped in the Persian Gulf each day. Sparta's Neil Crosby stated, &#34;We have basically only solved half of the problem.&#34;
<h2>Saudi East-West Pipeline Races to 7 Million Barrels, Yanbu Loading Volume Reaches Record Range</h2>
The Saudi East-West Pipeline is the core of alternative supply. Amin Nasser stated that Saudi Aramco expects to push this 746-mile-long pipeline to a maximum throughput of 7 million barrels per day, with about 2 million barrels supplied to Saudi refineries and approximately 5 million barrels available for export.
The IEA indicated that this scale is equivalent to most of the crude oil that Saudi Arabia exported through the Strait of Hormuz before the war.
But this also serves as a stress test for infrastructure. The IEA emphasized that the pipeline has never operated at full capacity for an extended period. According to LSEG data, the average loading volume at Yanbu Port for the first nine days of March was 2.2 million barrels per day, significantly up from 1.1 million barrels per day in February.
Kpler data shows that the number of loading vessels in March could reach at least 40, which may push exports to over 4 million barrels per day. Traders noted that Yanbu Port's handling capacity exceeds 4.5 million barrels per day, but historically it has rarely exceeded 2.5 million barrels per day.
<h2>Historical Context: A Steel Artery Born from Conflict</h2>
The original intention behind the construction of the Saudi East-West Pipeline was to respond to the Persian Gulf crisis. In the early 1980s, the Iran-Iraq War threatened the safety of shipping in the Persian Gulf, prompting Saudi Arabia to decide to invest in the construction of this oil artery across the Arabian Peninsula to ensure that crude oil could bypass the shadow of war and reach the Red Sea.
According to an internal communication from Saudi Aramco in 1983, over 7,000 workers completed this project over four years, supervised by a division of Mobil Oil. The first batch of crude oil was delivered in 1981. To simultaneously construct a supporting natural gas byproduct pipeline, the construction team used 2,000 tons of explosives to blast a trench on the Arabian Peninsula.
The design intention of this pipeline was to bring Saudi exports closer to Western markets; however, today, the vast majority of Saudi crude oil exports have shifted to Asia.
There was also an unfinished opportunity for expansion in history. In early 1990, Iraq and Saudi Arabia jointly opened a large pipeline, planning to transport Iraqi crude oil directly to Yanbu, further expanding Red Sea export capacity. However, just seven months later, Saddam Hussein invaded Kuwait, and this pipeline has since been shelved and has never been put into use
<h2>Fujairah Pipeline Provides a &#34;Second Exit,&#34; but Freight Rates and Price Differentials Begin to Reshape Trading Logic</h2>
The Habshan to Fujairah pipeline in the UAE, which transports Abu Dhabi crude oil to the Fujairah port on the Gulf of Oman, has become another export route that bypasses the Strait of Hormuz.
According to IEA data, the pipeline has a maximum transportation capacity of approximately 1.8 million barrels per day, and before the war, it was operating at about 1.1 million barrels per day.
Companies are also feeling the cost pressure. Petrobras stated that Saudi Arabia has fulfilled its supply commitments through the pipeline, and its CEO mentioned that the main issue now has shifted to rising shipping costs.
The scarcity of alternative crude oil is reflected in the price structure. One signal is that Omani crude, which can be loaded outside the strait, is trading at a premium to the &#34;Dubai&#34; grade, which is loaded from the Fateh port inside the strait and is difficult to reroute.
<h2>Security Risks Spill Over from the Strait: Pipelines, Ports, and Red Sea Routes Become New &#34;Soft Spots&#34;</h2>
Alternative routes are not &#34;safe corridors.&#34; Market participants are concerned that as the importance of these two pipelines rises sharply, they may also become more direct targets for attacks.
Analysts warn that there are few factors that could prevent Tehran from shifting its focus to Saudi and UAE pipelines.
Risks at the port level have already emerged. Fujairah port was damaged last week in an attempted drone attack, prompting some fuel suppliers to withdraw from contracts.
There are also risks in the Red Sea direction. In 2024, the Houthi forces allied with Yemen and Iran launched dozens of attacks on merchant ships. Although they have not resumed attacks during the current war, the threat remains. The UK maritime security agency Ambrey advises vessels linked to the US and Israel to avoid the Red Sea.
According to an article published by Wall Street Journal on March 5 link, the three countries of France, Italy, and Greece have joined forces to coordinate military deployments to ensure freedom of navigation in the Red Sea, highlighting the importance of the Red Sea route and the complex military games in the region.
<h2>The Impact of This on Current Oil Prices as a New Variable</h2>
Against the backdrop of disruptions in the Strait of Hormuz, the loading rhythm from Yanbu to Fujairah, the stable operation of the east and west pipelines and the Habshan to Fujairah pipeline, as well as security incidents targeting pipelines and ports are collectively determining whether the &#34;supply gap will widen or be contained.&#34;
For investors, the focus has shifted from the single passage through the strait to the capacity realization of alternative routes, regional price differentials and freight rate changes, as well as any signals of damage to new facilities

The Saudi East-West Pipeline and the UAE Habshan-Fujairah Pipeline have a combined oil transport capacity of approximately 8.8 million barrels per day (the oil transport scale before the Strait of Hormuz was about 20 million barrels per day), and they are the only two routes that allow a large amount of crude oil to bypass the Strait of Hormuz. Analysts warn to be cautious of potential strikes on the oil pipelines and related ports, which could have a secondary impact on oil prices

- The global oil market is heavily reliant on two pipelines, the East-West Pipeline and the Habshan-Fujairah Pipeline, to bypass the blocked Strait of Hormuz for crude oil supply.  
- Despite these alternatives, they cannot fully compensate for the loss of flow through the Strait, as significant volumes of crude oil remain stranded in the Persian Gulf, and analysts warn of increased risks targeting these pipelines.  
- The current situation raises new variables affecting oil prices, with market focus shifting to the capacity and operational stability of these alternative routes and the implications of any disruptions.

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Hormuz Alternative Route: With the Middle East engulfed in war, the global oil market relies on these two pipelines to "extend its life"!