HSBC CEO predicts new Gulf pipelines could render Strait of Hormuz obsolete within five years
HSBC Group chief Georges Elhedery said that investments in alternative Gulf logistics could make the Strait of Hormuz redundant in about five years.
At the HSBC Future Forum in Dubai, Georges Elhedery warned that the conflict-driven focus on the Strait of Hormuz may accelerate the development of alternative transport routes in the Gulf. He explained that about 20 % of global oil and liquefied natural gas currently passes through the strait, but massive investments in pipelines to ports are underway, potentially making the waterway redundant within five years. Elhedery cited a $1.4 trillion planned infrastructure pipeline, including $872 billion of project packages from North Africa and Turkey, as evidence of the region’s shifting logistics landscape.
A recent HSBC survey of more than 1,600 business leaders and 820 institutional investors still views the Gulf as an attractive investment hub. Nonetheless, the World Bank recently projected a 1.3 % economic contraction for the Gulf, North Africa and Pakistan region this year, with a stronger but uneven rebound expected by 2027. The comments came as global financiers prepared to attend Saudi Arabia’s flagship investment conference, now postponed to 2027 after deadly strikes in Riyadh.
Why it matters
The shift could reshape global energy trade routes and reduce geopolitical risk tied to the Strait of Hormuz.
How this story developed
- Sep 29 Oil prices jump as US-Iran tensions flare and US troops leave Iraq
- Oct 2 The administration emphasized managing public expectations about a rapid settlement with Iran.
- Oct 5 Pezeshkian argued that three attacks have taken place since talks began, suggesting the U.S. aims to topple Iran. He said the adversary relies on assassination, sanctions and broken promises, making negotiations futile. The conflict started with U.S. and Israeli strikes in February and a June memorandum briefly outlined a resolution before Iranian actions in the Strait of Hormuz reignited fighting. Recent indirect talks at the UN failed to break the deadlock, and Foreign Minister Abbas Araghchi warned that only a just negotiation, not military force or new sanctions, could end the war.
- Oct 10 According to the Revolutionary Guard, the vessel hit a mine and burst into flames while transiting the Hormuz Strait. The flag of the ship has not been identified. The incident follows a series of recent attacks on vessels in the Persian Gulf, including Iran's claim that it shot at a tanker using an "illegal channel." The flare-up has contributed to a rise in global oil prices and renewed worries about the security of one of the world’s key oil transit routes.
- Oct 13 Trump’s Strait of Hormuz announcement and dismissal of Iran’s UN proposal occurred alongside a Brent price jump and the departure of the final U.S. soldiers from Iraq.
- Oct 14 Iran announced a revised method for targeting vessels in the Strait of Hormuz.
- Oct 17 A supertanker hit a sea mine in the strait, triggering a fire.
- Oct 17 President Pezeshkian issued a new statement declaring talks with the United States futile.
- Oct 20 US Central Command said about 400 ships and 100 million barrels of oil still transited the strait.
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