Mines, then miles

Good morning, ladies and gents, and happy Thursday. We open with the strait, and we’ll be on dry land by the time your coffee is gone.

Iran says four oil tankers caught fire after hitting mines while trying to pass through Hormuz yesterday. The Revolutionary Guards said the tankers were attempting a “prohibited passage south of the Strait of Hormuz” and that two other vessels were halted. It came a day after President Donald Trump said the US had launched strikes on Iran, and President Masoud Pezeshkian has said “no one will benefit from this war” if fighting resumes.

Three’s a charm? Adnoc has denied it, but Bloomberg’s sources say the UAE is mulling a third west-east pipeline to take crude around the strait. Bloomberg reports that plans could still change and that third parties may also be able to use the line through to Fujairah. Adnoc says the reports are “purely speculative” and “not accurate.” The existing Habshan-Fujairah line helped keep supplies moving, and Adnoc has been accelerating work on its West-East pipeline, which is set to double Hormuz-bypassing export capacity and could begin supplying Asian customers by early next year, as we reported last week.

The road is the other way to move goods around the Gulf, and it’s our Lede this morning. The roads are built and open, and customs is the part the GCC has integrated furthest. Who gets to drive on them is still decided by six governments: a truck’s cargo, vehicle, and driver each have to clear their own rules at a border, and clearing one border doesn’t give the driver the right to cross the next.

One quick one for the bond watchers: Pearl Petroleum priced a USD 500 mn five-year senior secured bond at a 10.375% coupon, joint operators Dana Gas and Crescent Petroleum said (pdf) yesterday. Books came in 1.7x oversubscribed, which let it upsize from an initial USD 400 mn, and the money refinances an existing USD 350 mn bond and funds development at the Khor Mor and Chemchemal gas fields in Iraq’s Kurdistan Region.

It’s also Pipeline day, so our weekly check on what moved in the Gulf’s megaproject pipeline is further down. This week, Gulf money went shopping abroad for Australian LNG, US power, and a UK data center.