US President Donald Trump has scrapped plans to impose a 20% levy on all cargo transiting the Strait of Hormuz, marking a sharp reversal in Washington’s stance on the vital waterway.
The announcement, made on Truth Social on Tuesday, signals a move away from punitive transit fees toward negotiated trade arrangements with Gulf states.
The proposed charge had sparked significant concern among shipping lines and energy traders, who feared the toll would disrupt the flow of roughly a third of the world's seaborne oil trade.
By abandoning the fee, the administration removes a looming threat to global supply chains that had begun to weigh on freight rates and insurance premiums in the region.
Instead of the unilateral tax, Trump indicated that the US would pursue direct trade agreements with countries in the Persian Gulf.
This pivot suggests a shift from confrontation to diplomacy, aiming to secure energy flows through bilateral deals rather than coercive taxation.