Donald Trump’s Strait of Hormuz toll reversal just raised more questions than it answered. The president’s 24-hour policy flip and its aftermath reveal what oil markets are still grappling with.
Donald Trump dropped the 20% fee plan, but tensions around the strait remain
Donald Trump reversed his plan to impose a 20% toll on all cargo passing through the Strait of Hormuz. He dropped the idea after Gulf allies mounted a 24-hour campaign to change his mind, CNN reported. Saudi Arabia, the United Arab Emirates, Bahrain, and Qatar all reached out to convince him.
Trump announced the toll on Truth Social on Monday, declaring the US would serve as the strait’s guardian. The proposal shocked Gulf allies and many of his own aides inside the White House. Aides scrambled to determine who would pay the fees and how collection would work.
His own advisers had warned against the idea for months before the announcement. They feared it would undermine US war aims and validate Iran’s own plans to charge fees. Secretary of State Marco Rubio had publicly stated weeks earlier that no country can charge tolls on international waterways.
Iranian Foreign Minister Abbas Araghchi quickly seized on Trump’s comments to justify Iran’s own position. “POTUS is absolutely right. Whoever provides secure and safe passage of commercial vessels through the Strait of Hormuz should be compensated for this service,” Araghchi said. He added that Iran would charge less, stating, “20% is of course too much. We will be fair.”
By Tuesday morning, Gulf leaders had persuaded Trump to abandon the toll in favor of new investment pledges. “I was called by different people, different countries, kings and emirs,” Trump said. He noted the allies wanted to handle the arrangement differently.
Advisers had also cautioned that tolls would push oil and gas prices higher ahead of November’s midterm elections. Shipping traffic through the strait has already dropped sharply amid the ongoing conflict. Oil prices have soared to levels not seen since before last month’s US-Iran peace agreement.
