The United Arab Emirates and Oman, as the only oil-producing countries in the Persian Gulf since the start of the U.S. war against Iran, have notably increased their oil export revenues. These two countries have capitalized on rising energy prices by utilizing alternative routes to bypass the Strait of Hormuz.
Use of Alternative Routes
The Strait of Hormuz, as a vital energy artery, has faced widespread disruptions since the beginning of tensions. Transferring shipments from one ship to another and using the UAE's oil pipeline to the port of Fujairah, which is outside the Strait of Hormuz, has played a significant role in maintaining the flow of exports from this country.
According to estimates by Iman Naseri, head of the Middle East section at the consulting firm FGE, the UAE earned about $53 billion from oil exports between March and August, reflecting a 54% increase compared to the same period last year. This is while, before the onset of the conflicts, one-fifth of all oil and gas supplied in global markets passed through the Strait of Hormuz.
Status of Revenues in Oman and Saudi Arabia
Oman's oil revenues have also surged by 81%, exceeding $13 billion. The volume of this country's exports has also seen a 28% increase. In contrast, Saudi Arabia has experienced a 3% decline in its export revenues, reaching $79 billion.
Despite these successes, experts warn that the surplus oil revenues of the UAE and Oman do not provide a complete picture of the broader economic costs of the war. Monica Malik, chief economist at Abu Dhabi Commercial Bank, emphasizes that governments have inevitably had to increase their spending in areas such as subsidies, and non-oil sectors of the economy are also suffering from the negative effects of these conflicts.
Despite the current boom, analysts believe that this increase in revenues is temporary and may face a decline with falling oil prices in the future. On the other hand, the current situation for the UAE carries risks due to its dependence on the continuity of cargo transfer operations in open waters.
