Iraq Plans $15B Pipeline to Bypass Strait of Hormuz Amid Us-iran War Disruptions

The project comes as shipping through the Strait of Hormuz, a critical global energy route connecting the Persian Gulf to the ocean, has been disrupted by the war between the US and Iran. Iraq, one of the world's leading oil producers, has seen its oil revenues decline and aims to diversify its export routes in case the strait is closed again. Sources familiar with the project said that the pipeline extending into Syria is projected to exceed $15 billion in cost.

US officials and energy company executives view the pipeline, for which feasibility studies are being conducted by a consortium that includes Chevron, as a key element in a strategy to reduce the global energy sector's dependence on the Strait of Hormuz. US Treasury Secretary Scott Bessent said last week: Within the next two years, the Strait of Hormuz will no longer matter. It will just be an ordinary body of water.

Before the US-Iran war, one-fifth of the world's oil and liquefied natural gas (LNG) production was shipped through the strait. Bessent said more than 50% or 70% of that amount would be transported via pipelines running underground.