The UAE is accelerating the construction of a new oil pipeline to divert oil through the Strait of Hormuz, aiming to double its exports.
The global energy crisis escalated following the prolonged US-Iran conflict, putting pressure on major shipping routes that transport one-fifth of the world's crude oil. Energy giant ADNOC is investing heavily in expanding the Fujairah port and accelerating the construction of new pipelines to double exports by 2027. This move, following its withdrawal from OPEC, aims to allow for a liberalized oil production and export policy to meet global demand.
May 16, 2026 – Geopolitical tensions in the Middle East remain the biggest risk factor severely pressuring global energy markets and the economy. In particular, the escalating tensions and potential war between Iran and the United States have resulted in the Strait of Hormuz, a vital maritime route carrying approximately one-fifth of global crude oil demand, falling under Iranian influence and control. This poses a significant risk of macroeconomic energy supply disruptions.
The war and uncertainty are forcing major energy exporting countries to accelerate strategic adjustments for economic survival. Currently, only the United Arab Emirates (UAE) and Saudi Arabia have the potential to develop alternative shipping routes to transport large quantities of crude oil to the global market. Other Gulf Arab states, such as Kuwait, Iraq, Qatar, and Bahrain, remain geographically constrained, relying almost entirely on shipping through the Strait of Hormuz for their oil exports.
ADNOC orders construction of new oil pipeline, aiming to double export capacity.
Due to pressure from all directions. Media offices of the United Arab Emirates (UAE). A major strategic plan for energy security has been unveiled. By stating that The Abu Dhabi National Oil Company (ADNOC) is accelerating its efforts to expand the crude oil handling and transportation capacity of the Fujairah port in the Gulf of Oman through the construction of a new crude oil pipeline connecting directly from major production sources to the port.
"The UAE wants to accelerate the construction of oil pipelines to double its crude oil export capacity by 2027."
Currently, ADNOC's existing transportation platform already has pipelines transporting oil from production sources to the port of Fujairah, with a capacity to transport approximately 1.5 million barrels of oil per day. However, according to Bloomberg, this figure is still less than half of the company's total export capacity.
Therefore, accelerating the construction of this second oil pipeline is of paramount business importance. In the past, during the conflict between the US and Iran that led to the control of the Strait of Hormuz, the port of Fujairah proved to play a crucial strategic role in trade, enabling the UAE to maintain stability and continue exporting crude oil to the global market without interruption.
Withdrawing from OPEC to seize a share of the global energy market amidst heightened tensions in the Middle East.
Beyond physically altering transport routes, the UAE's international economic policy moves have significantly impacted the global energy industry. This accelerated expansion of infrastructure and oil pipelines comes just months after the UAE announced its withdrawal from the Organization of the Petroleum Exporting Countries (OPEC).
This announcement of UAE's withdrawal from OPEC removes all legal and production quota restrictions, allowing the UAE government and ADNOC to independently and flexibly determine their own production policies and crude oil export volumes, without being bound by the group's decisions anymore.
Following its gain of full policy autonomy and with a new oil pipeline under construction, the UAE is aggressively pursuing plans to increase crude oil production and exports. This is to compensate for and meet the continuously rising global demand for oil, a direct consequence of the ongoing military conflict in the Middle East.
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