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Peter Sand, a chief shipping analyst at The Baltic and International Maritime Council, told Dow Jones that the use of longer alternate routes to carry oil shipments will increase transportation costs and cause oil to eventually reach the market at a time lag and in insufficient quantities.
According to the Dow Jones, the Strait of Hormuz is currently being used by OPEC members Kuwait, Iran, Iraq, Qatar, Saudi Arabia and the UAE to export crude oil.
The US Energy Information Administration recently reported that about 70 million metric tons of liquefied natural gas has passed through the Strait in January-October 2011.
Paul Domjan, advisor to Securing America’s Future Energy (SAFE), an organization committed to combating US oil dependence, says “most oil that could realistically be diverted through pipelines is 4.5 to 5 million gbpd even in the best-case scenario.”
Experts at Barclays Capital financial institution note that although alternative routes for crude exist, “they are limited in capacity (and) in many cases aren’t currently operating or operable, and generally engender higher transport costs and logistical challenges.”
One possible alternative is to use export terminal at the Red Sea port at Yanbu, where a pipeline carrying the Iraqi oil terminates, SAFE’s Domjan said.
He added, “From there crude would either move through the congested Suez Canal…or through the Gulf of Aden, which would be putting 2 million barrels of oil through the most pirate-infested part of Africa, the costs of protecting it would be massive.”
The remaining pipeline options, according to experts, are either deactivated, such as the Iraq-Turkey pipeline to the Mediterranean port of Ceyhan, or still hypothetical in the case of the Abu Dhabi pipeline.
“Coincidentally, the (only) oil exporting country that is in the best position to bypass the Strait of Hormuz is Iran, which has a pipeline network in place to enable the theoretical pumping of crude north to the Caspian Sea, from where there are plenty of options to export,” Domjan said.
Originally posted by truthinfact
That is why it is vital the Strait remain, NOT ONLY open, but also INTACT.
There's only a two mile stretch of water that the Oil Tankers can fit through... if the bottom of the strait was somehow messed up... that would take YEARS of Re-Charting.
It would be devastatinly bad for just about the price of Everything.
I was surprised at how much effort and work it took to show this guy that not only do those pipelines not exist in the real world, but if they did, they couldn't possibly handle the divert volumes we're talking about here.
Iran can simply go sink a few BIG derelicts into the middle of the shipping lanes. No military force can prevent that and every U.S. Carrier on Earth can't do a thing to help clear the lanes. It's closed for business for weeks or months.....and it doesn't even take ongoing effort to keep it that way.
Originally posted by Wildbob77
It would be expensive, but you could build a pipeline for an offshore station to be used for filling the supertankers.
It would take time and money but then the threat of Iran to close the strait would be reduced.
The discovery of oil in western Uganda could spell an end to poverty in the country within decades, according to President Yoweri Museveni. Exports are predicted to provide $2bn annually, and have the potential to transform the lives of the 40% of Ugandans who live on less than $1.25 per day.
But in Hoima district, plans for a new refinery that will displace 30,000 residents are causing concern rather than celebration.
In the first half of 2010, Tullow progressed a series of transactions to align interests and accelerate development of the Lake Albert Rift basin which culminated in the purchase of Heritage Oil and Gas Limited's ("Heritage") interests in EA-1 and EA-3A on 26 July. The process to subsequently farm-down interests to CNOOC and Total, with each partner taking a one third interest in EA-1, 2 and 3A, was signed on the 29th March 2011, following the signing of a MoU between Tullow and the Government of Uganda on 15 March 2011.
A gross 1.1 billion barrels of oil (P50) has already been discovered in the Lake Albert Rift Basin. With many prospects still to be drilled, Tullow believes the basin has an additional 1.4 billion barrels of oil (P50) yet to find.
Originally posted by oghamxx
reply to post by Tifozi
How would one close the straits? Sink how many ships?
Try Google earth on Alexandria Bay New York, an area called Thousand Islands (there are more than 1000). They are not super tankers but large ocean going ships pass thru channels less than a quarter mile wide, often within 50 feet of houses on small islands.