The Postwar Threat to Gulf Energy Infrastructure
During the U.S. and Israeli war against Iran, Tehran's threat to oil and gas shipping through the Strait of Hormuz cut Saudi oil exports by more than a third and reduced those of the UAE by over 50 percent, while Qatari and UAE LNG exports were entirely cut off. Gulf states are now pursuing at least seven new or expanded pipeline projects to bypass the Strait of Hormuz, which Goldman Sachs estimates could add almost 4 million barrels of export capacity per day by the end of 2027. Iran is also adapting, with Iranian-backed Houthi rebels in Yemen beginning to target Saudi tankers in the Bab el-Mandab in July 2026.
Why it matters: The pipeline build-out is an energy security response that would reduce the coercive leverage Iran derives from the Strait of Hormuz, yet the region's oil infrastructure remains vulnerable to Iranian sabotage, missile, UAV and cyber attacks.