In a direct response to the escalating energy crisis triggered by the conflict with Iran, US President Donald Trump has pledged that the American navy will provide military escorts for commercial vessels "if necessary". The move is a blatant attempt to break the deadlock in the Strait of Hormuz, a vital maritime artery that handles roughly 20 per cent of the world’s oil and gas, but which has been effectively paralysed following Iranian threats to "set fire" to any ship attempting the passage.
Beyond military muscle, the President has turned to the US Development Finance Corporation (DFC) to provide "political risk insurance" at what he describes as a "very reasonable price". By offering government-backed guarantees to shipping firms, the White House hopes to bypass the prohibitive premiums recently set by private insurers. Trump took to social media to launch the initiative as a crusade to "ensure the free flow of energy to the world," while hundreds of tankers remain stranded in the Gulf, nervous about the threat of Iranian missiles and the skyrocketing cost of a potential disaster.
The markets responded to the news with a muted drop in oil prices, but industry veterans remain skeptical about the move. Richard Meade, editor-in-chief of Lloyds List, was quick to point out that insurance and naval escorts are not a silver bullet. He drew parallels to the Houthi attacks in the Red Sea, noting that even with a US military presence, many firms still opted for the long, expensive detour around Africa rather than risk a direct hit. "Just because you've got a naval escort doesn't mean to say you're safe," Meade warned, suggesting that the physical danger to crews often outweighs any financial guarantee.
Trump, however, appears unfazed by the prospect of a prolonged disruption. Speaking to reporters at the White House on Tuesday, he defended the military campaign against Tehran, insisting that "something had to be done" to dismantle the regime. While he conceded that petrol prices might remain painfully high "for a little while," he brushed off concerns of a long-term recession. In his typical style, he predicted that once the dust settles, energy prices will plummet to levels lower than those seen before the war began.
With analysts warning that oil could surge past $100 a barrel if the Strait remains blocked, the stakes for the global economy have rarely been higher. The President is now set to meet with Energy Secretary Chris Wright and Treasury Secretary Scott Bessent to hammer out the logistics of this maritime shield, but the shipping world is watching with bated breath to see if a US flag on the horizon is enough to deter an Iranian strike.
Also read: Two Iranian drones hit US Embassy in Riyadh, Trump reacts
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