Hormuz could be 'redundant' in five years, replaced by new routes, HSBC CEO says

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The conflict has highlighted the world's heavy reliance on the strategic waterway, through which a fifth ‌of global oil and LNG trade previously passed

By Reuters

Updated - October 20, 2026 at 01:42 PM.

FILE PHOTO: Georges Elhedery, Group Chief Executive of HSBC, attends the Global Financial Leaders' Investment Summit, in Hong Kong, China, November 4, 2025. REUTERS/Tyrone Siu/File Photo | Photo Credit: Tyrone Siu

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 Chief ⁠Executive 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 per cent in 2025, ‌the World Bank last week forecast a deep economic contraction of ​1.3 per cent 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.

Published on October 20, 2026

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