The ports keeping the Gulf alive — for now

Washington and Tehran appeared to be edging closer on Wednesday (6) to a one-page memorandum to end the Gulf war — with the emphasis on appeared. Sources told Reuters a deal could be sealed within days, and the region is already shifting on expectations of de-escalation. But we’ve been here before.

Nevertheless, the conflict has left deep structural changes. In this week’s Gulf Currents, we examine how the UAE’s Hormuz bypass has become a ​frontline vulnerability, and the quieter economic fallout — from rising geopolitical risk to the surprising ways disrupted supply chains are reshaping daily life in Dubai’s restaurants.

NEWS BRIEFING

– The UAE said its air ‌defences engaged Iranian missiles and drones for a second consecutive day on Tuesday, calling the attacks a serious escalation and reserving the right to respond. Tehran denied launching any strikes, while Iran’s military warned of a “crushing response” if the UAE were used as a launchpad for any attack on Iran.

– The IMF warned the global economy faces a “much worse outcome” if the Iran war extends into 2027 and oil hits $125 a barrel, with chief Kristalina Georgieva saying the fund’s relatively benign baseline scenario for a short-lived ​conflict was already surpassed. The IMF’s adverse forecast — 2.5% growth and 5.4% inflation — is now in effect, with fertiliser costs up 30-40% and food prices set to follow.

– France’s Charles de Gaulle carrier ​group has crossed the Suez Canal and is heading to the southern Red Sea and Gulf of Aden, as Paris and London prepare a joint mission to protect shipping ⁠in the Strait of Hormuz. Nearly a fifth of the world’s oil passes through the strait, where Iran-linked disruption has severely hit traffic.

UAE’S HORMUZ BYPASS BECOMES A FRONTLINE VULNERABILITY

When the Strait of Hormuz effectively closed, the ​UAE did what its geography allowed and pivoted east.
Fujairah and Khor Fakkan, two previously secondary ports on the Gulf of Oman coastline, absorbed the shock and kept the country — and parts of the wider Gulf — commercially alive.

The bypass ​worked. The number of containers handled at khor fakkan has jumped roughly 25-fold. But Monday’s drone strikes on the Fujairah Oil Industry Zone were a pointed reminder of what that success has cost in strategic terms.

The two ports are not merely convenient alternatives. They have become existential infrastructure. Khor Fakkan is now the UAE’s principal east-coast intake point, handling cargo that would previously have called directly at Dubai’s Jebel Ali port — everything from groceries to medical supplies, with truck movements rising from 100 to 7,000 a day.

Fujairah’s ​role is different but equally indispensable: it sits at the end of the Abu Dhabi Crude Oil Pipeline, the inland route that has allowed state oil giant ADNOC to keep exporting oil to global markets throughout the ​conflict. Without it, the UAE’s current energy export strategy collapses entirely.

That concentration of function is also a concentration of vulnerability. By routing so much of the region’s commercial survival through two points on the same coastline, the structural reconfiguration of ‌Gulf trade has ⁠handed Iran a precise map of where it might apply maximum pressure.

The IRGC navy’s map, published Monday night, made that explicit: the new zone of control extends along significant stretches of the UAE’s Gulf of Oman coastline — the very waters the region has been treating as its escape route. Shipping experts said on Tuesday that neither port had yet been affected — but the message was unmistakable.

This is not a hypothetical threat. Iran has already tested Fujairah twice. A drone strike on March 14 hit the port, triggering fires and suspending oil-loading operations. Monday’s attack struck again. Oil prices jumped about 6% and Brent futures settled at nearly $115 a barrel.

The ships keep coming. But ​for Qatar, Kuwait and Bahrain — whose only sea links lie ​entirely behind Hormuz — the fallback if these ports ⁠come under sustained pressure is costly and slow: overland shipments routed from Saudi Arabia’s Red Sea coast, a congested and expensive alternative that was never designed to carry the weight of regional trade.

Iran’s Revolutionary Guards navy issued a new map of the area of the Strait of Hormuz it said ​was under its control on Monday, state media reported.

The area starts in the west with a line between the westernmost tip of Iran’s Qeshm island to ​the United Arab Emirates’ Umm ⁠al Quwain emirate. In the east, the area stops at a line between Iran’s Mount Mobarak and the UAE’s Emirate of Fujairah.

THE LAST WAVE

Dubai chefs gut menus as Iran war makes ingredients hard to source

The Iran war has closed a critical shipping lane, rattled Gulf economies and, in Dubai, made it very hard to find a decent tomatillo.

The effective closure of the Strait of Hormuz has sent air freight costs soaring by as much as 70% on some ⁠routes, making specialty ingredients ​like Norwegian scallops and Mexican tomatillos harder and pricier to source.

Chefs are shrinking menus, leaning on local fish and produce, and pivoting ​to set-price deals and meal kits to keep diners coming. A survey of 400 UAE restaurants found demand down 27% on average, with supplier costs up 13%. Dubai authorities have rolled out fee relief and dining campaigns to cushion the blow.

The good news: chefs say ​a sense of normality is slowly returning since the April 8 ceasefire.

Image generated with Artificial Intelligence.

Source: article by Andrew Mills for Reuters

Sharing is caring!