Hormuz could be 'redundant' in five years, replaced by new routes, HSBC CEO says
DUBAI – Investment in alternative logistics routes in the Gulf to mitigate the impact of the Iran war could make the Strait of Hormuz "redundant" in the next five years, HSBC Group CE Georges Elhedery said on Tuesday.
The conflict has highlighted the world's heavy reliance on the strategic waterway, through which a fifth of global oil and liquefied natural gas trade previously passed.
It is forcing Gulf nations to channel resources towards the development of energy pipelines to ports, investments that Elhedery said will allow the region to weather the fallout from the conflict.
"We do see this region being able to recover and then continue growing. It will mean a lot of investment," the bank CEO said during the HSBC Future Forum event in Dubai.
"Of course, we do wish and hope to see a resolution to the conflict ... But Hormuz, probably in five years' time, may become redundant," he added.
The Middle East, North Africa and Turkey are offering $872-billion in individual project packages, part of a wider $1.4-trillion planned and unawarded infrastructure pipeline, HSBC said in a report on Monday citing data from MEED, a Dubai-based construction industry market intelligence platform.
A recent HSBC survey of over 1 600 business leaders and around 820 global institutional investors, meanwhile, found that they still considered the Gulf an attractive investment hub.
However, after growth of 3.3% in 2025, the World Bank last week forecast a deep economic contraction of 1.3% in the Middle East, North Africa and Pakistan region this year due to the war. That should be followed by a strong but uneven rebound in 2027.
Elhedery was among global financiers expected to attend Saudi Arabia's flagship investment conference, which was planned for next week but postponed to 2027 on Monday following deadly strikes in Riyadh by Yemen's Iran-backed Houthis.
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