The End of the Chokehold: US Treasury Secretary Foresees Strategic Decline of the Strait of Hormuz

In a recent interview with a local television station in Arizona, US Treasury Secretary Bessent presented a provocative outlook on the future of global energy logistics, arguing that the Strait of Hormuz is on a trajectory to lose its long-standing status as a primary strategic choke point. For decades, this narrow waterway has been viewed as one of the most volatile and critical arteries of the global economy, given its role in transporting a vast portion of the world's oil. However, Bessent believes that geopolitical shifts and infrastructure investments are fundamentally altering this dynamic.

According to Bessent, the persistent efforts by Iran to exert control over the strait have accelerated a regional desire to find alternatives. He posited that within the next two years, the Strait of Hormuz could evolve into what he described as a 'regular body of water,' losing the immense strategic leverage it once provided. The core of this transition, he claims, is a massive shift in transportation methods. Bessent suggests that a significant portion of the energy currently shipped via tankers—potentially between 50% and 70%—will eventually be rerouted through underground pipeline networks.

This vision is supported by the ongoing initiatives of major Gulf producers. Nations such as Saudi Arabia and the United Arab Emirates (UAE) have been aggressively expanding and modernizing their oil pipeline systems. By upgrading land-based transport networks and developing pipelines that bypass the strait entirely, these countries aim to insulate their exports from the regional volatility and the threat of blockades. From Bessent's perspective, these structural changes are not merely incremental improvements but represent a paradigm shift that will weaken the strait's role as a global energy bottleneck.

Despite these optimistic projections, a closer look at the data reveals a significant gap between the theoretical goal and the current reality. Publicly available statistics indicate that existing pipeline capacities in the Gulf are still far from being able to replace the volume of sea-borne traffic. Before recent escalations in regional conflict, it was estimated that over 20 million barrels of oil per day traversed the strait. In contrast, the combined pipeline capacity of Saudi Arabia and the UAE is currently estimated at approximately 4.7 million barrels per day, leaving a massive deficit that tankers must still fill.

Efforts to bridge this gap are underway, however. The UAE, for instance, is currently investing in new pipeline infrastructure projects with an expected operational date in 2027. Such projects underscore a strategic imperative to reduce reliance on the waterway, but they also highlight the time lag associated with such massive engineering feats.

Furthermore, energy analysts point out that the strategic importance of the Strait of Hormuz extends beyond crude oil. The waterway is essential for the transport of liquefied natural gas (LNG), as well as various petrochemical products and fertilizers. Unlike crude oil, these materials cannot be easily or economically transported via pipelines. LNG, in particular, requires specialized tankers, meaning that as long as the world relies on Gulf-based gas exports, the strait will remain a critical vulnerability.

Ultimately, while the diversification of transport routes may mitigate some risks, it does not entirely erase the geopolitical tensions inherent to the region. Moving oil through pipes may bypass a specific waterway, but it does not remove the broader risks of regional instability. Therefore, while the strategic weight of the Strait of Hormuz may be diminishing, the notion that it can be completely rendered irrelevant remains a subject of significant debate among geopolitical strategists.