In 2006, 93 percent of Persian Gulf oil exports passed through the Strait of Hormuz in tankers.[i] Not only is tanker transport through the Strait efficient, but simply put, alternate routes do not exist.
Several overland pipelines can carry oil to ports on the Red Sea or the Mediterranean Sea, but their capacity is limited. Many of those pipelines are in need of repair and upgrades or "are closed due to political, economic, or geopolitical issues in the area."[ii] Additionally, using pipelines to transport oil to other export terminals adds substantial travel time, both en route via pipelines and also for the tankers that must then take less direct routes to their ultimate destinations.
Source: Energy Information Administration. Country Analysis Briefs: Persian Gulf Region (for larger version: http://www.eia.doe.gov/emeu/cabs/Persian_Gulf/images/pg_map.pdf)
Caption: An EIA map showing the pipeline network in the Middle East
The most viable alternative to the Strait of Hormuz for oil exports is the East-West Pipeline (Petroline), which traverses Saudi Arabia. Oil from the Persian Gulf can travel through this pipeline to the port of Yanbu for export via the Red Sea. As of 2006, the East-West Pipeline operated at only 50% capacity, leaving "slack" capacity of about 2.5 million barrels per day.[iii] Other pipelines in the region have minimal capacity relative to the amount of oil passing through the Strait of Hormuz.
Key pipelines in the region include:
|PIPELINE||CAPACITY (barrels per day)|
|East-West Pipeline (Petroline)||5 million|
|Abqaiq-Yanbu Natural Gas Liquids Pipeline||290,000|
|Trans-Arabian Pipeline (Tapline)||50,000|
|Iraqi Pipeline through Saudi Arabia (IPSA)||1.65 million|
|Strategic Pipeline||1.4 million*|
|Iraq-Syria-Lebanon Pipeline (ISLP)||700,000|
|*needs repair and/or significant upgrade before operational at this capacity|
Source: Data taken from Energy Information Administration. Country Analysis Briefs: Persian Gulf Region
It is possible to inject chemical drag reduction agents (DRAs) into existing pipelines to increase throughput without new construction. However, most pipelines, including the Petroline, need additional pumps and other equipment upgrades to use DRAs.
In general, increasing pipeline capacity is costly and time consuming. In 1997, the Baker Institute published a study proposing different options for increasing pipeline capacity in Saudi Arabia. The most ambitious option would increase Petroline capacity to 11 million barrels per day at a cost of $600 million. In addition to the staggering cost, construction would take at least 18 months.[iv]
Increasing pipeline capacity is clearly not possible as a short-term response to any conflict in the Strait of Homuz. From a long term perspective, countries within the region might explore incremental increases in capacity over longer periods of time in order to reduce their vulnerability to conflict in the Strait. The United Arab Emirates has been discussing a pipeline from Abu Dhabi to Fujayrah, circumventing the Strait, for a long time, and actually began construction on a 1.5 million barrel per day pipeline in 2007.[v]
[i] Energy Information Administration, Country Analysis Briefs: Persian Gulf Region (June 2007). Online. Available: http://www.eia.doe.gov/emeu/cabs/Persian_Gulf/pdf.pdf. Accessed: February 10, 2008.
[ii] Energy Information Administration, Country Analysis Briefs: Persian Gulf Region (June 2007). Online. Available: http://www.eia.doe.gov/emeu/cabs/Persian_Gulf/pdf.pdf. Accessed: February 10, 2008.
[iii] Energy Information Administration, Country Analysis Briefs: Persian Gulf Region (June 2007). Online. Available: http://www.eia.doe.gov/emeu/cabs/Persian_Gulf/pdf.pdf. Accessed: February 10, 2008.
[iv] M. Webster Ewell, Jr., Dagobert Brito, and John Noer, "An Alternative Pipeline Strategy in the Persian Gulf," The Baker Institute (April 1997). Online. Available: http://www.bakerinstitute.org/publications/TrendsinMiddleEast_AlternativePipelineStrategy.pdf. Accessed: February 11, 2008.
[v] Matt Chambers, "What Happens if Iran Blocks the Strait of Hormuz?" Wall Street Journal (August 27, 2007).
This page last modified in August 2008