Trump scraps 20% Hormuz cargo fee as US prepares Iran port blockade
Image: BBC News
In a sudden U-turn, President Donald Trump has dropped his plan to charge the world a 20% fee just to sail through one of the planet's most vital waterways.
On Monday, Trump declared the US the "guardian" of the Strait of Hormuz and vowed a 20% "reimbursement fee" on all cargo moving through it. Hours later, he reversed course, saying the charge would be replaced by trade and investment deals with Gulf states that he promised would be "MASSIVE" — though he offered no details.
The about-face comes as the US prepares to reimpose a naval blockade on Iranian ports, part of a widening confrontation with Tehran that has already sent oil prices climbing and slowed tanker traffic through the strait to a trickle.
The strait carries a fifth of the world's oil. Iran, which accuses Washington of interfering in its management of Hormuz, can use control of the waterway to threaten the global economy — leverage both sides are now exploiting.
Recent exchanges have been fierce: US strikes aimed at degrading Iran's ability to hit shipping, Iranian attacks on US facilities in Bahrain and Jordan, and blasts reported in Iranian cities including Bushehr, home to a nuclear plant.
Centcom says the blockade takes effect Tuesday evening. Whether Trump's deal-making can calm the waters — or simply shift the cost from shippers to Gulf treasuries — remains the open question for markets worldwide.