The UAE is accelerating plans to raise crude export capacity from Fujairah to as much as 4mn b/d by 2027, as Abu Dhabi seeks to further reduce reliance on the strait of Hormuz.
Abu Dhabi state-owned Adnoc is building a new "West-East Pipeline project, which will double Adnoc's export capacity through Fujairah," Abu Dhabi's media office said today. The pipeline is under construction and is expected to become operational in 2027, it said.
Plans for the project were initiated in late 2024, before the US-Israel war with Iran, a source told Argus. The conflict, and subsequent disruption to shipping through Hormuz, accelerated the importance of the expansion, the source said.
Abu Dhabi already operates the 1.5mn b/d Habshan-Fujairah pipeline (Adcop), which started operations in 2012 and has become critical since the war began in allowing the UAE to bypass Hormuz. The pipeline has recently been operating at around 1.7mn-1.8mn b/d, Argus understands.
When the new 48-inch, 1.5mn b/d route is complete, combined pipeline capacity to Fujairah will reach around 3.3mn b/d, and crude export capacity from the port could rise to as much as 4mn b/d when accounting for storage and terminal infrastructure, the source said.
Fujairah is the world's third-largest crude and refined products storage hub, giving the UAE additional flexibility to manage exports and commercial flows outside the Hormuz chokepoint.
The acceleration in the expansion comes after the UAE quit Opec and the wider Opec+ alliance, effective at the beginning of May, following a review of its long-term production strategy and capacity plans. Abu Dhabi said at the time that it wanted greater flexibility to respond to global oil demand in line with its national interests.
The UAE says its production capacity is 4.85mn b/d, while its final Opec+ quota for April was 3.429mn b/d. The Iran war and closure of Hormuz reduced UAE crude output to around 2.02mn b/d in April and 1.9mn b/d in March, according to Argus assessments.
Saudi Arabia is the only other major Gulf producer with significant infrastructure capable of bypassing Hormuz, through its 7mn b/d [East-West pipeline system] (https://direct.argusmedia.com/newsandanalysis/article/2825625) linking the Abqaiq processing complex to the Red Sea port of Yanbu.
