{"id":115120,"date":"2026-04-15T16:52:10","date_gmt":"2026-04-15T11:22:10","guid":{"rendered":"https:\/\/mavericknews30.com\/?p=115120"},"modified":"2026-04-15T16:52:12","modified_gmt":"2026-04-15T11:22:12","slug":"erecting-a-full-length-pipeline-to-bypass-the-strait-of-hormuz-would-cost-more-than-55-billion","status":"publish","type":"post","link":"https:\/\/mavericknews30.com\/?p=115120","title":{"rendered":"Erecting A Full Length Pipeline To Bypass The Strait Of Hormuz Would Cost More Than $ 55 Billion."},"content":{"rendered":"\n

Washington DC; April 2026<\/strong>: As Iran\u2019s effective blockade of the Strait of Hormuz has made Saudi Arabia, Qatar, United Arab Emirates alongwith others pay a hefty toll to get their fuels to reach their buyers. Now, as per latest report the control of the strait has been taken over by the United States, who has implemented a total ceding of passages.<\/p>\n\n\n\n

Hence, it has become necessary to find out an alternative avenue, and the omnipotent solution lies with the erection of a pipeline that would bypass the seafaring the strait in future. There is little recent historical precedent for a nation to tax passage through a natural waterway. Under the 1936 Montreux Convention, Turkey doesn\u2019t charge for entry to the Black Sea, while Danish tolls for shipping to \u200cpass through the Oresund strait were abolished in 1857 amid international pressure. Egyptian fees for Suez Canal transit, like those levied by the Panama Canal, are different: both are artificial passages that need cash for their upkeep.<\/p>\n\n\n\n

Depicting the exact amount charged by the Iranian authorities remains a formidable task; however, in the last month, at least one of the handful of ships that has transited the strait has paid $ 02 million, which is the same figure as cited by several media outlets. Meanwhile, encouraged by the receiving Iran would \u200blook to levy, citing two senior Iranian officials. Just before the war, up to 50 tankers carrying crude, other oil products and liquefied natural gas typically passed \u2060through each day, or 18,250 a year, which clearly estimates that Iran can theoretically earn $ 37 billion annually if traffic normalises.<\/p>\n\n\n\n

Other suggested measures include a much smaller figure, around $1 per barrel. Around 20 million daily barrels flowed through Hormuz before \u200bthe war, of which perhaps half could conceivably find another route based on existing infrastructure. Assume the $1 fee applied to 10 million barrels per day, then, and the annual total would be $ 03.70 billion per year for Tehran. That looks like the low end of \u200breasonable estimates.<\/p>\n\n\n\n

Even this relatively small yearly toll would surge costs up. Apply a 5% discount rate, which is roughly Saudi Arabia’s 10 years borrowing cost, to 25 years of payments at $ 3.7 billion annually. The total sum is $54 billion in today’s money. The question is whether that conservative number is high enough to incentivise Iran’s Gulf adversaries to construct a workaround to dodge the tolls, in the form of oil pipelines that skirt the strait.<\/p>\n\n\n\n

One vulnerable point is whether it would really work? Merely replicating Saudi\u2019s 1,200-kilometre, 07 million barrel\/day pipeline to the port of Yanbu on the Red Sea would create new \u200bproblems. Gulf states would still have to get their product past the Bab el-Mandeb Strait near Yemen. The nearby territory is controlled by Iran-aligned Houthi rebels, raising the risk of further drone attacks on new and old pipelines.<\/p>\n\n\n\n

Strait Of Hormuz Plan Would Also Avoid A Key Red Sea Chokepoint<\/strong> \u2013<\/p>\n\n\n\n

Gabriel Collins, of Rice University\u2019s Baker \u200bInstitute for Public Policy envisages twin pipelines with 56-inch diameters, each carrying 5 million barrels of daily supply, stretching 1,800 kilometres from southern Iraq through Kuwait and then along the coast to pick up oil from Saudi and the \u200cUAE. Terminating in \u2060two Omani ports, Duqm and Salalah, it would avoid both the Red Sea and Gulf chokepoints, meaning crude could flow freely east into the Indian Ocean to Gulf states\u2019 main Asian customers.<\/p>\n\n\n\n

But it would take up to 07 years to build, and cost a lot. Gulf states might have to shelve out $ 18 billion alone on the construction cost of the pipelines and pumping stations to move the oil along them, Collins reckons. Add a further $ 12 billion in project development expenses and $ 07 billion headroom in the plausible event of the project taking longer, or hitting snags. He also assumes nearly $ 08 billion for new oil loading terminals at Duqm and Salalah, and $10 billion to fortify critical sections with C-RAM and Patriot anti-missile systems.<\/p>\n\n\n\n

The overall costs come to $ 55 billion, which is roughly the same \u200bas the $ 54 billion low-end estimate for the present value of \u200b25 years of possible Hormuz toll payments. In other words, \u2060the pipeline projects could potentially pay for themselves over a generation by allowing the Gulf states to avoid Tehran’s strait fees. That’s surely worth doing, since the real tolls could be higher, and ending dependence on an adversary has incalculable value, and as apprehended the turbulent geo-political architecture may fragment further deep.<\/p>\n\n\n

\n
\"\"<\/figure>\n<\/div>\n\n\n

Even for hugely wealthy states like Saudi and the UAE, these numbers represent an expensive undertaking, and an extremely unwelcome one, given all they would \u200bdo is provide new infrastructure for the same fossil fuels they intend to increasingly pivot away from. Even if they take the plunge, they will still have to pay tolls \u200bbefore the pipelines become operational.<\/p>\n\n\n\n

Still, it seems \u2060logical for Saudi and its neighbours to get building. Over 80% of the burden of paying the tolls would likely fall on Gulf states, according to Bruegel research, opens new tab. They could split the cost of new pipelines in step with their intended usage.<\/p>\n\n\n\n

Of course, there’s another way to conceive of these numbers. Arguably they give Iran a maximum target for how much it could hope to raise. It should rationally set the tolls at a level that would be as high as possible without incentivising Gulf rivals to build the new pipelines.<\/p>\n\n\n\n

And plenty could \u2060change in the \u200bnext 07 years. U.S. President Donald Trump is now implementing a blockade of Iran-approved ships that are making it through Hormuz, and an intensified war that \u200bultimately unblocks Hormuz is still possible. Yet Iran has proved that it has the ability to wage asymmetric warfare around Hormuz, and the regime seems hard to budge.<\/p>\n\n\n\n

Even if Saudi and its neighbours pay $55 billion for pipelines that remain as a backup, they might still view that as a sound investment to \u200bcounterfeit the apprehended geo-political fiasco.<\/p>\n\n\n\n

Team Maverick<\/strong>.<\/p>\n","protected":false},"excerpt":{"rendered":"

Washington DC; April 2026: As Iran\u2019s effective blockade of the Strait of Hormuz has made Saudi Arabia, Qatar, United Arab Emirates alongwith others pay a hefty toll to get their fuels to reach their buyers. Now, as per latest report the control of the strait has been taken over by the United States, who has …<\/p>\n","protected":false},"author":10,"featured_media":115123,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[74],"tags":[81],"post_format":[],"flags":[],"class_list":["post-115120","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-world-news","tag-world"],"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/mavericknews30.com\/index.php?rest_route=\/wp\/v2\/posts\/115120","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/mavericknews30.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/mavericknews30.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/mavericknews30.com\/index.php?rest_route=\/wp\/v2\/users\/10"}],"replies":[{"embeddable":true,"href":"https:\/\/mavericknews30.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=115120"}],"version-history":[{"count":1,"href":"https:\/\/mavericknews30.com\/index.php?rest_route=\/wp\/v2\/posts\/115120\/revisions"}],"predecessor-version":[{"id":115124,"href":"https:\/\/mavericknews30.com\/index.php?rest_route=\/wp\/v2\/posts\/115120\/revisions\/115124"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/mavericknews30.com\/index.php?rest_route=\/wp\/v2\/media\/115123"}],"wp:attachment":[{"href":"https:\/\/mavericknews30.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=115120"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/mavericknews30.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=115120"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/mavericknews30.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=115120"},{"taxonomy":"post_format","embeddable":true,"href":"https:\/\/mavericknews30.com\/index.php?rest_route=%2Fwp%2Fv2%2Fpost_format&post=115120"},{"taxonomy":"flags","embeddable":true,"href":"https:\/\/mavericknews30.com\/index.php?rest_route=%2Fwp%2Fv2%2Fflags&post=115120"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}