The current study investigates numerically the rehabilitation of corroded steel pipes using specified CFRP properties to optimize the reduction in burst capacity under distinct corrosion parameters. Two literature testing were examined numerically to validate the generated FEM model. Two sensitivity analyses encountering 144 FEMs were carried out to explore the rehabilitation of corrosion parameters such as width, depth, and length. The results generated equations to predict the hoop stresses for specified burst pressure. Additionally, the study explores the serviceability state at specified minimum yield strength “SMYS” and the maximum allowable operating pressure “MAOP” proposed by “ASME/ANSI” code under two cases; narrow and wide defects. The results show that stresses concentrate near the edges and accumulate in the middle of the narrow and wide defective areas. Thus, the stiffness governs by integrating the steel and CFRP modulus until the steel yields; then, the CFRP stiffness governs reaching its ultimate strain. The results show that the CFRP delays the hoop stresses and generates the ultimate strength, pronounces the most for the deep defect. The burst capacity increases by 20%, 50%, and 80% for shallow, intermediate, and deep defects, handling more strain, about 78% at intermediate defects due to the CFRP confinement which reflects on increasing the “SMYS” by about 5 to 10%. Several recommendations for failure prevention were deduced and recorded. Finally, design equations show a good agreement with the FEM in comparison to the other equations proposed by standards and guidelines, predicting the hoop stress while rehabilitating the defective area.