U.S. Treasury Secretary Scott Bessent stated earlier this month that new oil pipelines will make the Strait of Hormuz "irrelevant" within two years. The statement comes six months after a U.S. and Israeli operation killed Iran's leader in late February, initiating a conflict that has significantly disrupted global energy supplies. While the U.S. is counting on Middle East producers to build infrastructure that bypasses the shipping chokepoint, energy analysts and the International Energy Agency (IEA) report that current projects are unlikely to replace the strait’s capacity in that timeframe.
The Strait of Hormuz traditionally handles approximately 20 million barrels of oil per day, representing one-fifth of the world’s daily oil supply. Since the start of the war, shipping through the waterway has slowed to a trickle, leading to the largest energy supply disruption on record. In response, the United Arab Emirates expects a $3 billion pipeline expansion to Fujairah to be operational next year. However, the IEA notes that larger projects, such as a Saudi Arabian pipeline expansion, will likely take several more years to complete.
Even if planned projects are finished, analysts indicate they may only provide a partial solution. Former U.S. State Department special envoy David Goldwyn estimated that new pipelines would handle 10 million to 12 million barrels per day, leaving a significant shortfall compared to pre-war levels. Furthermore, Robert McNally of Rapidan Energy Group noted that redirected routes remain vulnerable to Iranian attacks. Meanwhile, Qatar, the world’s second-largest liquefied natural gas (LNG) exporter, remains reliant on the strait as there are no bypass pipelines for LNG.
The impact extends to global food and travel markets. Because the Gulf is a primary source of fertilizer, consumers are facing higher food prices, alongside increased costs for jet fuel and travel. The IEA reports that the crisis affects supply chains for aluminum, microprocessors, and healthcare commodities. In the United Kingdom, the National Institute of Economic and Social Research assessed that the energy shock will reduce GDP by 0.3% this year, equivalent to £12.8 billion. British households face an average loss of £480 this year due to higher energy prices, as domestic inflation reached 2.9%.
The conflict has also resulted in significant human and political consequences. Over 8,000 people have been killed across the Middle East since February 28, 2026, including 18 U.S. service members. Domestically, U.S. President Donald Trump's approval rating fell to 33% in a Reuters/Ipsos poll concluded Monday, with 31% of Americans supporting military action against Iran. As the U.S. midterms approach in November, all House seats and one-third of the Senate will be contested. The IEA states that until a durable regional settlement is reached, bypass routes will remain a limited alternative to the Strait of Hormuz.