The UAE and Saudi Arabia have opened up and started operating a pipeline for oil exports which bypasses the Strait of Hormuz.
The new link is expected to double the total pipeline capacity to 6.5million barrels a day, according to reports.
The move will also reduce Iran’s power over oil markets as the country has repeatedly threatened to close the channel between the Gulf of Oman and the Persian Gulf if western powers target its oil exports.
Peter Kiernan, Energy Analyst at the Economist Intelligence Unit said: “About 75% of oil exports that go through the Strait of Hormuz go to Asian markets, making that region particularly vulnerable in the event of a military conflict between Iran and the West. The redirection of Saudi crude oil to export terminals in the Red Sea could be particularly convenient for the supply of markets in North America and Europe.”