$100 Oil: Gulf Producers Scramble to Diversify Pipeline Routes

Oil prices have soared to $100 per barrel for the first time since May, as the Strait of Hormuz remains largely closed due to the ongoing war. In response, Gulf oil producers are racing to build alternative pipelines to bypass this critical maritime chokepoint.

Before the conflict, around 15 million barrels of oil passed through the Strait every day, accounting for a fifth of the world's traded oil. With at least seven major pipeline projects underway or in planning, supplies can now be pushed out through the Red Sea, Suez Canal, and Gulf of Oman instead.

Saudi Arabia's East-West pipeline, built in the 1980s, carries crude from Abqaiq to Yanbu on the Red Sea. The UAE has also been channelling more oil to Fujairah, its port on the Gulf of Oman. Abu Dhabi's state oil company is racing to finish a $3 billion pipeline project that will lift deliveries by over 1.2 million barrels a day.

However, experts warn that the Red Sea route has vulnerabilities of its own. Yemen's Iran-backed Houthi rebels have disrupted the Bab el-Mandeb Strait and attacked Saudi tankers in the past.