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US Treasury Secretary: Hormuz Strait to Become Obsolete Within Two Years via Pipeline Diversion
Energy Minerals · Oil & Gas Production · yonhap_finance · 2026-09-01
US Treasury Secretary Scott Bessent announced that global oil transport will shift to land-based pipelines within two years, bypassing the Hormuz Strait.
What Happened
Decline of the Hormuz Strait's Strategic Role: US Treasury Secretary Scott Bessent stated that the Hormuz Strait, a critical energy chokepoint, will lose its significance within two years due to ongoing geopolitical instability. He noted that Middle Eastern oil producers are actively developing land-based pipeline infrastructure to bypass the volatile maritime route.
Diversification of Energy Supply Chains: As the transit point for roughly 20% of global oil, the strait has become a major vulnerability following Iranian aggression against tankers. The U.S. strategy focuses on securing energy flows by shifting reliance away from the sea lane toward more stable, land-based pipeline networks.
Escalation of Sanctions Against Iran: Secretary Bessent confirmed plans to impose further sanctions on additional financial institutions linked to Iran. Following the recent blacklisting of a major Egyptian bank's UAE branch, the U.S. intends to target more entities involved in illicit financial activities over the coming weeks.
Economic Isolation Strategy: The U.S. is adopting a zero-tolerance policy toward any organizations, including aircraft leasing firms, that conduct business with the Islamic Revolutionary Guard Corps (IRGC). Bessent emphasized that the administration is working closely with allies to economically isolate and neutralize the Iranian regime.