Donald Trump backs down on 20 percent fee to guard Strait of Hormuz
President Donald Trump has abandoned a proposed 20 percent fee on shipping through the Strait of Hormuz, opting instead to pursue trade and investment deals with Gulf states. This decision follows heightened military tensions in the region, including Iranian missile attacks on US-linked bases.
Why it matters
The reversal highlights the delicate balance between military posturing and economic diplomacy in a region critical to global energy supplies.
United States President Donald Trump stepped back from a proposal to charge a 20 percent fee to guard the Strait of Hormuz as part of the conflict with Iran, saying he would instead seek investment deals with Gulf states.
US forces had carried out waves of attacks for the third night in a row after Tehran said it had closed the strait, prompting Trump on Monday (US time) to reinstate a blockade of Iranian shipping and propose the fee.
But just a little under five hours before the fee had been due to come into effect at 2000 GMT (8am Wednesday NZ), Trump said the strait was open to all shipping traffic except that of Iran.
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