For more than 40 years, the port of Jebel Ali has played a pivotal role in Dubai’s rise from a regional trading post to a global commercial hub. However, ongoing conflict between the United States, Israel, and Iran has sharply exposed vulnerabilities in this model, as disruptions in the Strait of Hormuz have severely curtailed operations at the port, a critical lifeline for the emirate’s economy.
Eirik Hooper, a senior associate at maritime consultancy Drewry and former DP World executive, described the instability affecting Gulf shipping routes as posing an "existential risk" to Dubai. Jebel Ali, he noted, has been integral to the emirate’s development and economic strategy.
The port’s origins trace back to Dubai’s historic position as a trading nexus between India and the United Kingdom during its time as a British protectorate. Dubai’s ruler Sheikh Rashid bin Saeed Al Maktoum championed the development of Jebel Ali in the 1970s and 1980s amid skepticism that the project was overly ambitious. The establishment of the Jebel Ali Free Zone in 1985 marked a turning point, enabling businesses to import components, manufacture goods, and re-export without undergoing standard customs procedures. The zone now hosts approximately 12,000 companies. Additionally, the nearby Al Maktoum International Airport is undergoing a $35 billion expansion, aimed at becoming the world’s busiest by passenger numbers and cargo capacity.
This integrated approach has allowed Dubai to diversify its economy away from hydrocarbons, with the port and free-trade zone contributing more than 20 percent of the emirate’s GDP. Last year, Jebel Ali accounted for roughly 30 percent of DP World’s revenue. The port’s strategic value has attracted significant foreign investment, including a $5 billion stake acquired by Canada’s Caisse de dépôt et placement du Québec in 2022 and a subsequent $2.4 billion investment by Saudi Arabia’s Hassana.
Before the recent conflict, Jebel Ali’s four container terminals processed around 40,000 twenty-foot equivalent units (TEUs) daily, making it the largest shipping hub in the Middle East. The war has brought a drastic downturn: container volumes have dropped by more than 90 percent in the first weeks of hostilities and have yet to recover meaningfully. Ship movements through the Strait of Hormuz remain significantly reduced despite a temporary ceasefire and reopening of the waterway, averaging 17 vessels per day as of late August, compared with roughly 135 daily prior to the conflict. Renewed fighting threatens to further disrupt this flow.
DP World has sought to counterbalance the effect. Although the slump at Jebel Ali has weighed on its results, container volume growth at other global terminals in DP World’s portfolio — which spans 60 ports in 80 countries — has helped offset losses. In response to the heightened risk, the company is advancing plans to build two port terminals in Fujairah on the Gulf of Oman coast, aiming to reduce reliance on the vulnerable Strait of Hormuz. These new facilities are expected to have roughly half the general cargo capacity of Jebel Ali once completed in approximately two years. However, Fujairah lies within range of Iranian missile capabilities and has already been targeted during the conflict. Other regional operators are similarly expanding capacity in more secure locations, including Gulftainer in Sharjah and CMA CGM in Oman.
Despite these efforts, replicating Jebel Ali’s extensive infrastructure and integrated logistics network remains a significant challenge. Industry experts emphasize that the port’s advantage extends beyond physical capacity to include its extensive business ecosystem and transport links, especially air freight services provided by Emirates. A senior Emirati executive remarked that building a comparable system in Fujairah would be "impossible" given the magnitude of existing infrastructure centered around Jebel Ali.
This vulnerability was long recognized but inadequately addressed, according to Hooper. Other regional ports outside the Gulf could theoretically handle additional cargo volumes, with Drewry estimating spare capacity of up to 20 million TEUs annually. Yet many lack the critical transport infrastructure needed to service Dubai efficiently. For example, Oman's Sohar port, despite having 3 million TEUs of capacity, is located about 1,200 kilometers over difficult desert terrain from Dubai with no freight railway, limiting its practical utility.
The port’s disruption is not limited to DP World but threatens Dubai’s broader economic model of trade openness and diversification. Adeel Malik, associate professor of development economics at Oxford, described the current crisis as a potential turning point for Dubai and the UAE.
Iran’s economy remains closely linked to Dubai. Jim Krane, a Middle East energy fellow at Rice University, noted that Dubai is reportedly the second-most important city to Iran’s economy after Tehran, suggesting Iran has incentives to maintain maritime access to Jebel Ali. Nonetheless, the ongoing conflict highlights the scale of risk facing the port and the economy built around it.
"Dubai as we know it would not exist without Jebel Ali," Krane said. "It’s just that important."