The tanker Texas Voyager is anchored off Chevron’s El Segundo refinery in El Segundo, California, March 4, 2026.
Patrick T. Fallon | Afp | Getty Images
The Trump administration on Friday announced a $20 billion reinsurance program for oil tankers and other maritime traffic, with the aim of allowing ships to pass through the Strait of Hormuz.
Crude oil prices in the United States jumped 35% this week as tanker traffic in the Persian Gulf remains at a standstill due to the war in Iran. Some Gulf countries have started to cut production because they cannot export their crude across the strait.
The American International Development Finance Corporation will ensure losses of up to $20 billion on an ongoing basis. The DFC and the Treasury Department said they are cooperating closely with U.S. Central Command to implement this plan.
“We are confident that our reinsurance plan will help move oil, gasoline, LNG, jet fuel and fertilizer through the Strait of Hormuz and back to the world,” Ben Black, CEO of DFC, said in a statement.
The strait is the world’s most important chokepoint for crude oil, with around 20% of global consumption exported through the narrow waterway. About 20% of global liquefied natural gas exports also pass through the strait.
President Donald Trump said Tuesday the United States would provide insurance for commercial ships in the Persian Gulf and U.S. Navy escorts if necessary. Several oil tankers have been attacked since the United States and Israel launched a massive wave of airstrikes against Iran last weekend.
Insurance is not currently the biggest issue for shipowners, said Matt Wright, senior cargo analyst at consultancy Kpler. Oil tankers don’t cross the strait because they worry about their physical safety, Wright said.
“There has to be certainty that Iran’s ability to continue to wage war has diminished,” Wright told CNBC.