The Trump-Xi summit runs through Fujairah
When Chinese President Xi Jinping sits down with his US counterpart Donald Trump at the White House today, the cameras will focus on the usual subjects: tariffs, Taiwan, artificial intelligence, rare earths . The commentary in Washington and Beijing already reads the meeting as a contest between the world's two largest economies, each holding a chokepoint over the other. America controls the most…
The summit between Chinese President Xi Jinping and US President Donald Trump in Washington will focus on issues such as tariffs, Taiwan, artificial intelligence, and rare earths. However, there is a third critical chokepoint in this story, and it lies in the Gulf. This chokepoint is held by the United Arab Emirates (UAE), which has the capacity to supply China with an alternative to the Strait of Hormuz.
The UAE has been working on expanding its export capacity through the port of Fujairah, with plans for a second pipeline expected to be completed by 2027.
China's energy strategy involves reducing its dependence on Iranian oil, which currently accounts for about 13% of its crude imports. By diversifying its energy sources, China aims to avoid becoming hostage to a single stretch of water. The UAE is well-positioned to supply this alternative, as it left OPEC in May, allowing it to sell volume on its own terms.
Moreover, the UAE has established strong relationships with both China and the United States, supplying Chinese energy demand while also being one of America's closest partners on AI and data centers.
The opportunity for the UAE lies in the premium that barrels reaching Asia without crossing the Hormuz Strait carry. This premium is attributed to the reliability and political goodwill that such shipments provide. For the US, having a supplier that can help China diversify away from Iranian oil would be beneficial, as it would reduce China's reliance on American chips controlled by export controls.
The test for the UAE comes in the form of balancing its interests between the two rival superpowers. While the UAE has the potential to become indispensable to both China and the US, it must demonstrate its loyalty to neither. This balancing act is crucial for maintaining its position as a partner that both Washington and Beijing need.
The UAE should price the bypass route in long-term supply agreements and treat it as national infrastructure rather than a commercial project. Additionally, transparency in technology collaboration is essential, as American scrutiny on AI and data center practices will be particularly stringent.
Written by urgent.news from The National UAE's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
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