Conflict in the Strait of Hormuz has oil producers looking to spend billions to bypass it

Producers in the Persian Gulf are planning to invest billions in pipelines to redirect oil supplies, aiming to bypass the Strait of Hormuz, a critical passage currently under Iran’s influence. Before the conflict in Iran, about 15 million barrels of oil passed through the strait daily. Now, with rising oil prices and ongoing tensions, Gulf countries are keen to reduce their reliance on this route. At least seven major pipeline projects are underway or being considered, which would allow oil to be transported to ports along the Red Sea and the Gulf of Oman. However, these alternative routes are not without risks, as demonstrated by recent attacks by Yemen’s Iran-backed Houthi rebels on Saudi oil tankers in the Red Sea. Despite the potential for longer and more costly routes, Gulf producers recognize the need for a more secure and diversified strategy beyond the Strait of Hormuz. QUESTION: How might the development of alternative oil routes impact global oil prices and the economies of countries dependent on Persian Gulf oil?