Even if the Strait of Hormuz reopens, energy executives and analysts say the industry will no longer be able to count on it the way it used to. For the healthy, there is no way back to normal.
Countries across the region are exploring building, expanding or rehabilitating infrastructure that would bypass the strait.
And nations that import fuel from the region are racing to secure oil and gas from elsewhere, introducing conservation measures and turning to alternatives such as coal. These strategies are likely to change over time. Today’s coal consumption can make room for larger investments in e.g. solar energy and nuclear energy.
Whatever happens next, Iran will not forget how easy it is to choke shipping through the strait, meaning energy companies and consumers must prepare for a very different future.
“From the moment missiles started falling and drones started hitting, it was very clear that we were not going back,” said Badr Jafar, a businessman who serves as the UAE’s special envoy for business and philanthropy.
To stem the current energy crisis, Saudi Arabia and the Emirates have diverted significant portions of the oil they produce to ports away from the Strait of Hormuz via pipelines built years ago in preparation for a crisis. Iraq also recently began sending a small amount of oil to Turkey in a pipeline that has drifted in and out of service for years due to political and armed conflict.
More than seven million barrels of oil are shipped out of the Persian Gulf each day on one of these routes, up from fewer than four million barrels a day before the war, according to the International Energy Agency.
But that is a fraction of the 20 million barrels of oil that traveled through the strait daily before the war. And pipelines do nothing for geographically isolated countries like Kuwait and Qatar. They are also of little use for transporting aluminum, fertilizer and other goods.
For these reasons, not to mention geopolitical goals, the reopening of the strait remains very important. The strait’s centrality is why international oil prices fell 9 percent on Friday, to their lowest level since the second week of the war, after Iran’s foreign minister said the strait would be “fully open.”
But Tehran reversed course the next day after President Trump made it clear that US forces would continue to block ships traveling to and from Iranian ports. The United States later seized an Iranian-flagged cargo ship that Mr. Trump said he had tried to get around the US blockade.
That back and forth reinforced the idea that free passage through the strait can be stopped by any world power determined to do so.
“The Strait of Hormuz will be less important in 2030 or 2035 than it was in January,” said Elliott Abrams, who served as a special representative for Iran and Venezuela during the first Trump administration. “People will find alternatives.”
Some simpler options include expanding existing pipelines, storage capacity and ports in Saudi Arabia and the Emirates. But that would only solve part of the problem. Most Gulf countries do not have the benefit of access to another coast that lies outside the strait.
Iraq, which is among those without another coast, has floated building a new pipeline to the Mediterranean via Syria.
Political conflicts often hindered such cross-border projects in the past. A pipeline from Iraq through Saudi Arabia to the Red Sea was built in the 1980s. But Saudi Arabia shut it down in 1990 after Saddam Hussein, the Iraqi leader, invaded Kuwait.
Now, with few work alternatives, Iraq was forced last month to shut down production of an estimated three million barrels of oil per day, according to the IEA
“You can draw pretty lines on the map,” said Robin Mills, chief executive of Qamar Energy, a consultancy based in Dubai, United Arab Emirates. “Trying to make it happen in reality is something else.”
Mr. Jafar, the Emirati businessman and special envoy, expressed optimism that the war could inspire the kind of regional cooperation that had previously been elusive.
“There’s nothing like both a sense of urgency and a need to decouple from this choke point for us to see these kinds of things come together,” Mr. Jafar. “It’s not impossible, far from it.”
This kind of infrastructure will most likely cost billions of dollars—and potentially tens of billions for larger projects. That said, crises like the one the world is experiencing are also expensive.
“One or two months with an outage like this and it pays for itself,” said Mr. Mills, referring to smaller projects such as expanding existing alternatives.
Of course, no alternative would be foolproof, as Iran has demonstrated by attacking energy assets throughout the region. But having more options makes it harder for countries to cut off the supply of energy from the region.
Energy importers are also moving quickly to diversify away from the Persian Gulf, either by buying more fuel from the US or by making plans to restart nuclear power plants. These trends are likely to be sticky, energy experts say. They could give an advantage to oil and gas producers who are not at the mercy of maritime choke points and accelerate the transition away from oil and gas.
But remodeling energy trade routes to prioritize resilience – over efficiency – will be expensive. Such investments will take time and are likely to raise energy prices for consumers, said Spencer Dale, until recently the chief economist of London-based oil company BP.
“The world right now is more uncertain, more vulnerable than it was before,” said Mr. Dale, now Visiting Professor at the London School of Economics and Political Science. The rational response is to compensate by making the energy system more resilient to geopolitical upheaval, he said. “But it all costs money.”
