UAE’s Enduring Strength: A Strategic Pipeline for a More Secure Energy Future
The UAE has been struggling with the onslaught of attacks from Iran and the Strait closure. While Iran insisted the Strait was open to friendly nations, vessel seizures, naval drills, and selective permissions have heightened tensions globally. Several countries, including Japan, Malaysia, and China, negotiated individual arrangements to move through the international waterway, though the terms and tolls remain inconsistent.
International reactions reflect a mix of diplomatic and strategic caution, as China publicly rejected Iran’s attacks while still engaging in talks with both Iran and Washington. The United States, China, and European partners have emphasized reopening the Strait, while Iran asserts sovereignty and resists negotiations without concessions. Diplomacy in the Middle East remains fragile, emphasized by Saudi Arabia’s exploring options of a non-aggression pact and the 45-day extension on the ceasefire between Israel and Lebanon.
Economic Mitigation Measures
Despite previous reports of damage leading to a ban on steel exports from Iran, IRIB News reported that steel was plentiful and available on the commodity exchange. Shortly after the steel export news, IRIB released an announcement from the Ministry of Agriculture Jihad saying a new foreign exchange ceiling for the import of rice and oil-based goods. The proposed reason for the change was to supply goods and coordinate shortages in an effort to evade massive price inflation.
A couple of hours after the goods import information was released, IRIB News reported an announcement from the Director of Energy Consumption Optimization, stating that 76 petrochemical complexes were operating at a total capacity of 100 million tons annually and were seeking to import sufficient raw materials to offset any shortages.
Energy Strategy and Military Posturing
According to reports from Reuters that the Institute for the Study of War (ISW) cited, the United Arab Emirates (UAE) seeks to double the exporting capacity in Fujairah to bypass the waterway, reducing vulnerabilities. Abu Dhabi’s Crown Prince Sheikh Khaled bin Mohamed bin Zayed has ordered a major acceleration of the nation’s West-East Pipeline project. By instructing the state’s national oil company to fast-track construction, the leadership aims to drastically alter how the country safely transports its crude oil to the global market.
The project is aimed at increasing Fujairah crude export capacity to roughly 3.6 million barrels per day by 2027. The ISW posits that this is part of a broader strategy by the Gulf states to safeguard energy exports from disruption at chokepoints in the Strait, as evidenced by reports on May 12, 2026, showing Gulf states expanding into ground-transport logistics.
The ISW reported, based on a release from Bloomberg, that the UAE had sought to get its fellow Gulf states to launch a coordinated attack on Iran when the United States and Israel’s assault on Iran began. The UAE’s attempt ultimately failed to get the Gulf states to unify; only the UAE and Saudi Arabia conducted individual strikes on Iran. Based on previous reports, the actions most likely led to the late-April Gulf Cooperation Council push for peaceful de-escalation and return to prewar conditions.
ISW cited a Reuters report that the UAE objected to portions of Iran’s statements that require consensus as a condition for signing the final joint communique. Iranian Foreign Affairs Minister Abbas Araghchi pressed that certain countries rejected consensus based on Iran’s military actions, asserting they only targeted United States bases, with the UAE flatly rejecting the statements. The UAE was said to have claimed the right to reserve its full sovereign, legal, diplomatic, and military rights to respond to hostilities and or threats.
Building Negotiations Framework
Expanding on the Israeli-Lebanese negotiations in Washington, the ISW reports that they set a framework for negotiations, seeking peace, recognizing the sovereignty of each territory, with security talks starting May 29, 2026. The focus of May 29, 2026, will be on disarming Hezbollah, preparing the Lebanese Armed Forces for deployment, and the withdrawal of Israeli forces from Lebanon. The United States will continue working to broker dialogue and enhanced cooperation when they reconvene on June 2-3 for discussions.
The ISW cites Lebanese media reporting from United States sources that the United States believes both parties know they must address Hezbollah, each has its own way of implementing, and political details of Hezbollah’s disarmament, with Lebanon seeking Israel’s military presence out of its territory.
Iranian Toll Replaced With Insurance
The ISW reported that Fars News announced a new policy from Iran’s Economy Ministry, replacing the original toll system with a maritime insurance policy. Announced on May 16, 2026, the new plan is to sell shipping companies a verifiable insurance policy that insures safe travel along the waterway without fear of Iranian attack. ISW cited an X post by the Iranian Parliament National Security Committee Chairman, Ebrahim Azizi, who said Iran established a formal system to manage traffic through the Strait, asserting Iranian sovereignty while maintaining the safety of international commerce.
The full plan’s details were not revealed, but Azizi’s comments directly referenced collecting fees for specialized services, which the ISW posits could be the insurance. The only clear message was that only commercial ships and those who cooperate with Iran will benefit, as he ended his statement saying it is closed to those who work with or help facilitate President Donald Trump’s freedom project. The Iranian Revolutionary Guards Corps (IRGC) Navy was said to be permitting passage of ships from the People’s Republic of China (PRC), Japan, and Pakistan, with NourNews reporting unspecified European members in negotiations with the IRGC Navy for passage.
Defa Press painted a strategic picture of the IRGC’s swarm tactics, highlighting their ability to prohibit shipping in the Strait by using nimble, small, and numerous watercraft.
Trade Routes on Land
In an effort to evade the naval blockade from the United States, Fars News reported that Iran-PRC rail trade has tripled since the invocation of the United States blockade against Iran. They have begun moving to a new transit route through Pakistan, allowing third-country transit from Pakistani territory into Iran. ISW cited Fars reporting that the new Iraqi Prime Minister, Ali al Zaidi, instructed customs authorities in northern, central, western, and southern Iraq, as well as Baghdad International Airport, to launch transit transport and re-export procedures with Iran.
As of May 17, 2026, the United States Central Command (CENTCOM) declared they had redirected a total of 81 ships and disabled 4 since the April 13, 2026, blockade began.
UAE Faces New Drone Strike
Reporting from the Associated Press through Hawaii Public Radio showed a stark contrast to Iran’s earlier statements as the UAE’s four-reactor Barakah plant experienced sudden drone strikes on May 17, 2026. A fire was sparked by drone strikes at the UAE’s sole nuclear power plant in what is being called an unprovoked terrorist attack. No injuries were reported, but the UAE Defence Ministry claimed three drones crossed its western border with Saudi Arabia. Two drones were intercepted, but one hit the Barakah nuclear power plant in Abu Dhabi, which the UAE built with assistance from South Korea.
This was reportedly the first time it had been targeted and is known to be the only nuclear power plant on the Arabian Peninsula, providing a quarter of the energy needed to the UAE. Saudi Arabia denounced the attack and later said its defenses stopped three drones coming from Iraqi airspace.
