21SEP

Qatar refuses to hedge against Hormuz

3 min read

15:34UTC

Saad al-Kaabi, Qatar's energy minister, publicly rejected US Treasury Secretary Scott Bessent's forecast that the Strait of Hormuz becomes worthless within two years. Qatar has deliberately built no bypass capacity at all, unlike Saudi Arabia and the UAE.

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ConflictDeveloping

Key takeaway

Qatar has no overland option for its gas, so it is betting Hormuz stays open.

Saad al-Kaabi, Qatar's energy minister and chief executive of QatarEnergy, rejected the US Treasury Secretary's forecast for the Strait of Hormuz at the Qatar Economic Forum in New York on Sunday 20 September. "I mean, maybe this is his view. I think this is completely wrong", al-Kaabi told Bloomberg, and said of the strait that "I don't think this is ever going to be obsolete" ¹. He was answering Scott Bessent, who told an interviewer in Asheville, North Carolina on Tuesday 1 September, alongside meetings with G20 finance ministers, that "In two years, the strait of Hormuz will be like a worthless piece of water" ². Bessent said in the same interview that the oil would travel overland by pipeline instead ³. Two allies, one chokepoint, opposite forecasts.

Each side has already spent money on its answer, which is what lifts this above a spat between officials. Saudi Arabia and the United Arab Emirates are extending Hormuz bypass capacity through Red Sea ports and overland pipelines. Qatar has deliberately declined to build any ⁴. For utilities in Japan, Korea and Europe that buy Qatari liquefied natural gas on twenty-year contracts, that refusal sits in the gas price rather than in a diversified route.

Laying a bypass pipeline takes years and repays over decades, which makes this the slowest bet either government can place. A line laid for a war that ends in 2027 becomes a stranded asset with decades of repayment left on it. A chokepoint left unhedged in a war that does not end becomes a national emergency. Qatar is insuring against the war ending; Washington's Treasury is insuring against it lasting.

Bessent has one solid argument: capacity that exists on land cannot be blockaded at sea, and a mined strait carrying about 20% of the world's seaborne oil has no published clearance timetable. Drones shut Saudi Arabia's own East-West line on 10 September and it is still not at full capacity , which cuts the other way on how durable a pipeline actually is. Against Bessent sits a fact of physics rather than of strategy: no pipeline yet built or planned can move liquefied gas, because the fuel has to be chilled at a coastal terminal and lifted by a specialised carrier. Qatari cargo has no alternative loading point at any price.

Deep Analysis

In plain English

The Strait of Hormuz is the narrow sea passage between Iran and Oman that a fifth of the world's oil and gas must pass through. US Treasury Secretary Scott Bessent has predicted that within two years, new overland pipelines will let oil producers bypass the Strait entirely, making it commercially worthless. Qatar's energy minister, Saad al-Kaabi, told Bloomberg at the Qatar Economic Forum on 20 September that he thinks Bessent's forecast is completely wrong. The disagreement matters because Qatar has no such bypass pipeline of its own and has chosen not to build one, betting instead that the Strait will remain essential. If Bessent is right, that bet could leave Qatar's gas exports stranded; if al-Kaabi is right, the huge cost of building an alternative route would have been wasted money anyway.

Deep Analysis

Root Causes

Qatar's exposure runs deeper than any other Gulf LNG exporter's because QatarEnergy, supplying roughly a fifth of world LNG, has no alternative export corridor: unlike Saudi Arabia's East-West Petroline or the UAE's Fujairah pipeline bypass, Qatar's North Field gas has no land route to the Mediterranean or Red Sea, so every cargo must transit Hormuz regardless of conflict risk.

Al-Kaabi's public rejection of Bessent's bypass-pipeline forecast follows from that dependency: Qatar has had years to build alternative capacity and chose not to, leaving two possibilities. Either al-Kaabi's technical read is correct that no viable bypass route exists for Qatari gas, or Doha has placed a bet it cannot economically hedge even if the forecast proves right.

What could happen next?

Risk
Qatar's decision not to build bypass pipeline capacity leaves its entire LNG export model, roughly a fifth of world supply, dependent on Hormuz remaining navigable for the foreseeable future.

Source Landscape

This story draws on neutral-leaning sources from United States

United States

Primary parallel: Predictions that a chokepoint would be engineered out of relevance have a poor track record: the Suez Canal was widely declared strategically diminished after the 1956 crisis prompted alternative supertanker routes around Africa, yet Suez traffic recovered and grew once the canal reopened in 1957.

Counter-parallel: The Bosphorus did lose relative importance after the 2000s expansion of the Baku-Tbilisi-Ceyhan pipeline, which let Caspian crude reach Mediterranean markets without transiting Turkish straits at all, showing that overland bypass routes can structurally erode a chokepoint's leverage when the infrastructure investment is actually made, which is the scenario Qatar has chosen not to pursue.

Consensus view: Treasury Secretary Scott Bessent told an Asheville interview on 1 September, on the sidelines of G20 finance minister meetings, that the strait "will be like a worthless piece of water" within two years, pointing to overland bypass pipelines as the reason Hormuz's chokepoint leverage will erode.

Counter-view: Saad al-Kaabi, who as QatarEnergy's CEO and Qatar's energy minister controls roughly a fifth of global LNG supply routed through that same strait, told Bloomberg at the Qatar Economic Forum on 20 September that he thinks Bessent's forecast is "completely wrong" and does not expect the strait ever to become obsolete.

Key tension: Qatar has deliberately built no bypass pipeline capacity of its own, so al-Kaabi's disagreement carries commercial weight beyond rhetoric: QatarEnergy's entire LNG export model is a direct bet against the scenario Bessent described.

First Reported In

Update #179 · Russia and China kill Iran's UN monitor

Bloomberg· 21 Sept 2026

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Different Perspectives

Shipping and insurance industry

UKMTO counted about 20 US-facilitated Hormuz transits a day to 11 September against only 6 visible on AIS, with traffic still around 90% below the 138-a-day pre-war baseline. War-risk underwriters cannot price hulls they cannot see, or resolve whether the tanker El Gaia hit a mine, as Iran claims, or a missile and drone, as CENTCOM says.

European refiners

European refiners, including Poland's Orlen, absorbed a roughly $26 gap between Dated Brent at $130.80 on 15 September and ICE Brent futures settling at $103.87 on 18 September, a spread that widened from $13.45 on 9 September rather than newly opening. Their futures hedges no longer cover what they now pay for physical barrels.

Saudi Arabia

Saudi Aramco zeroed European term customers' October allocations and rerouted roughly 60 million barrels to Asia through Ras Tanura and Sohar, using Red Sea and Gulf terminal capacity built years ago to cut Hormuz exposure. Riyadh reallocated existing supply rather than negotiating a shortfall with Europe.

Qatar

Qatar's energy minister Saad al-Kaabi told Bloomberg at the Qatar Economic Forum on 20 September that Bessent's two-year Hormuz-obsolescence forecast is wrong, and that Doha has deliberately built no bypass pipeline. Qatar's gas exports run through one waterway by choice, not oversight.

Iran (foreign ministry and Majlis)

Iran's foreign ministry and 130 Majlis deputies moved toward NPT withdrawal this week, with lawmaker Hossein-Ali Haji Deligani filing a triple-urgency bill on 20 September that Speaker Qalibaf has not yet scheduled. Tehran treats treaty membership as leverage still on the table, not yet spent.

Russia and China

Moscow and Beijing vetoed the Panel of Experts' renewal, maintaining Resolution 2231 lapsed in October 2025 and the 2025 snapback was never validly triggered, so the sanctions architecture the Panel enforces has no current legal standing. Both governments frame the veto as upholding law, not shielding Tehran.