The Strait of Hormuz crisis is driving nations’ efforts to develop alternative Gulf-to-Europe trade routes, with Iraq’s $24 billion “development route” project at the forefront, analysts say.
The route from Iraq’s Grand Fou port to Turkey and Europe is progressing “with discipline,” global affairs analyst Muhanad Seloum told Fox News Digital, calling it a “permanent” and “transformational” wartime change.
Seloum’s comments came after President Donald Trump warned Tehran against further escalation in the Gulf and signaled the United States was ready to act to keep the strait open.
The Iranian military has laid mines along the narrow waterway, threatening commercial traffic. As of Sunday, the carriageway remains effectively closed.
Iran is trying to give global economy a heart attack by closing Strait of Hormuz, says UAE minister
“Iraq’s development path means that every container passing through Basra instead of Iranian-controlled waters reduces Tehran’s leverage over Iraq,” Seloum said.
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“Actually scaled, independent estimates put the development road closer to $24 billion, and the project is now progressing with discipline,” he said.
Iraqi Prime Minister Mohammad Shia al-Sudani inaugurated the first 63-kilometer stretch of the development road in 2025. Phase 1 will be completed by 2028.
“What the Iraqi government has described as the flagship of Iraqi statecraft now has a regional logic that governments and financiers see as necessary rather than ambitious,” said Saloum, an assistant professor at the Doha Institute for Graduate Studies.
“Sudanese seems to have placed Iraq exactly where he thinks its geography has always suggested as a state linking the Gulf, Turkey and Europe,” he said.
See shipping through the Strait of Hormuz halted amid Iran dispute
But other regional infrastructure, Sellum says, has been pushed forward in parallel.
Saudi Arabia’s east-west gasoline pipeline is operating close to its 7 million-barrel-per-day capacity, with expansion plans under review.
The ADCOP pipeline to Fujairah in the UAE is also at maximum utilization, with a second line being discussed, he said. “Turkey’s Zanjezur and Central Corridors bypass Iran through the Caucasus and are four to five years out.”
He added: “Six Gulf-backed overland fiber projects are also underway through Syria, Iraq and the Horn of Africa.”
Iran reimposed closure measures in the Strait of Hormuz on April 18, reducing traffic to just a handful of ships per day compared to the pre-war average of 130 to 140.
