Trump reverses Strait of Hormuz toll, shifts to investment deals

U.S. President Donald Trump abandoned his plan to impose a 20% toll on cargo ships transiting the Strait of Hormuz, replacing it with investment commitments from Gulf states after a 24-hour diplomatic scramble. The reversal followed urgent calls from leaders of Saudi Arabia, UAE, Qatar, Bahrain, and Kuwait, who proposed direct investments in U.S. manufacturing and infrastructure instead of paying a fee Source: CNN.

The original plan and reversal

On Monday, Trump declared the U.S. the 'Guardian of the Strait' and announced a 20% fee on all cargo passing through the vital waterway, intended to compensate Washington for military protection Source: AP News. The idea was conceived on the fly, catching advisers and allies off guard Source: CNN. Within hours, Gulf leaders lobbied Trump to drop the proposal. By Tuesday, he announced on Truth Social that the toll would be replaced by 'Trade and Investment Agreements' from Gulf states, calling the investments 'MASSIVE' Source: ABC.

Market and industry reaction

Oil prices, which spiked over 5% on Monday, moderated after the reversal. Brent crude settled at $84.73, and WTI at $79.34 Source: Excélsior. Shipping industry groups warned that even discussing tolls sets a dangerous precedent, potentially normalizing fees on international waterways Source: Infobae. The International Maritime Organization reiterated that no legal basis exists for such charges Source: El Español.

Continued conflict with Iran