Arabian Business reported that a pipeline to send oil from the UAE directly to the Indian Ocean instead of being shipped by tanker through the Strait of Hormuz probably will be finished this year.
Mr Mohamed Al Hamli oil minister of UAE said that the USD 3.3 billion pipeline to the UAE’s easternmost emirate, Fujairah aims to bypass the Strait and will carry about 1.5 million barrels of oil per day.
The waterway is a chokepoint at the mouth of the Arabian Gulf for a fifth of the world’s oil supplies. Iran has threatened to block the Strait if attacked because of its nuclear program.
Mr Al Hamli said that while the UAE is confident the Strait will remain open to tankers, the purpose of the pipeline is to really not put too much pressure on the ships coming into the Gulf.
He declined to comment on whether OPEC members would agree at the meeting to raise or lower oil production levels. He said that current world oil prices aren’t high when measured against higher exploration and production costs.
Mr Al Hamli said that the age of easily accessible oil is coming to an end. Oil prices are not high at all while the costs of oil exploration and production have exponentially increased.