US Treasury Secretary: Strait of Hormuz to Lose Its Importance Within Two Years

US Treasury Secretary Scott Bessent suggested in an interview with US channel 12News that the Strait of Hormuz could lose its significance within the next two years, stating that 50% to 70% of the energy currently transiting the strait would be rerouted through underground pipelines.

The administration of US President Donald Trump has repeatedly indicated in recent weeks that an agreement to open the strait might be imminent, before Iran denied holding talks. It remains unclear whether the latest round of negotiations will lead to a more sustainable arrangement.

Reuters had previously cited five informed sources saying that Saudi Arabia is considering increasing the capacity of its crude oil pipeline to the western coast on the Red Sea to 9 million barrels per day, which would enable it, and possibly its neighbors, to transport larger volumes of oil without needing to cross the Strait of Hormuz.

The East-West Pipeline was established in the early 1980s and gained importance following the outbreak of the Iran war in February and the resulting halt in shipping through the Strait of Hormuz.

Sources said that Saudi Arabia is holding preliminary talks with some of its neighbors regarding the potential expansion of the pipeline’s capacity by up to 2 million barrels per day.