- Fujairah’s coastline on Gulf of Oman
- Adnoc pipeline leads directly to the emirate
- Crude exports rose to 1.62m bpd
Until earlier this year, Fujairah was best known for its beaches and mountains. Now, as the US and Iran move towards peace, the emirate, located outside the Strait of Hormuz, is emerging as one of the biggest economic winners from the conflict.
Analysts say the US-Israeli war with Iran accelerated Fujairah’s rise as a critical centre for the UAE’s energy exports, shipping and trade, reinforcing its strategic importance at a time when businesses and governments are reassessing regional supply chains and energy security.
Home to the UAE’s only coastline entirely on the Gulf of Oman, Fujairah became a vital economic lifeline during the conflict as shipping through Hormuz was disrupted and regional supply chains came under unprecedented strain.
“Fujairah has proved crucial for oil exports, both to keep the world economy going and sustain the UAE’s revenues,” said Robin Mills, chief executive of consultancy Qamar Energy and AGBI columnist.
At the centre of that resilience was the 360km Abu Dhabi Crude Oil Pipeline linking Habshan in Abu Dhabi to Fujairah. Capable of transporting 1.5 million to 1.8 million barrels per day (bpd) while bypassing Hormuz entirely, it enabled Abu Dhabi state oil company Adnoc to maintain exports even as tanker traffic through the strait collapsed.
“It was crucial,” Mills said. “Only in the late stages of the blockade did significant tanker traffic start managing to get out.”
The experience has strengthened the case for further investment. Adnoc is accelerating construction of a second west-east pipeline connecting Habshan directly to Fujairah, a project understood to be around halfway complete and expected to significantly increase export capacity once operational. A third pipeline is also under review, the UAE’s trade minister, Thani Al Zeyoudi, told Bloomberg.
“The era of one strait, one port, one route is over,” said Amer Bin Breik, director of the Future of Foreign Trade Department at the UAE Ministry of Foreign Trade.
Crude exports from Fujairah rose to an average of 1.62 million bpd by late March, up from 1.17 million bpd in February, according to commodity intelligence firm Kpler.
Fujairah already handles roughly a third of the world’s bunkering traffic and sits at the end of a pipeline network designed to bypass one of the world’s most strategically sensitive waterways.
The UAE is also looking beyond oil. Al Zeyoudi said plans were under way to expand Fujairah Port, as well as the neighbouring ports of Dibba and Khorfakkan, and develop another harbour on the east coast.
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Rachel Ziemba, a macrostrategy adviser in New York, said the conflict had pushed Fujairah “onto the map for a larger group of investors and buyers than ever before”.
“The conflict reinforced the importance of these bypass channels,” she said.
The emirate became an increasingly attractive option for shipping companies seeking to avoid both security risks and soaring war-risk insurance premiums.
Ahmed bin Sulayem, executive chairman and chief executive of Dubai Multi Commodities Centre, said the conflict had fundamentally changed perceptions of the emirate.
“We’ve noticed that Fujairah’s relevance will change since the shipping industry can now reship and redistribute from Fujairah port without concerns about the Strait of Hormuz,” he said.
