US President Donald Trump has abruptly abandoned plans to impose a 20% levy on all cargo vessels transiting the Strait of Hormuz.
The reversal marks a significant shift in Washington’s approach to the critical energy chokepoint, replacing the proposed toll with a strategy to seek compensation from Gulf allies.
The decision comes amid heightened clashes with Iran and follows days of speculation regarding the potential toll.
The proposed levy had sparked concerns over its impact on global energy flows and shipping costs, particularly given the Strait’s role as a vital artery for international oil trade.
By pivoting to seek compensation from Gulf partners, the administration appears to be recalibrating its strategy to balance security concerns with economic stability.
This move may alleviate some immediate pressure on shipping markets, though the underlying geopolitical tensions in the region remain unresolved.