US President Donald Trump on Tuesday, July 14, 2026, withdrew his proposal to impose a 20 per cent fee on commercial cargo passing through the Strait of Hormuz. The decision came less than a day after the proposal was announced and follows discussions with Middle East leaders.

Trump stated on social media that the proposed fee, known as the United States Reimbursement Fee, would be replaced by "Trade and Investment Deals that the various Gulf States will be making into the United States." He described these investments as "MASSIVE" and beneficial to the countries involved but did not specify which governments would participate or the value of the commitments.

The reversal occurred after Trump had initially declared on Monday that eligible vessels would be charged a fee equivalent to 20 per cent of their cargo's value to help cover the cost of securing the strategic waterway. Despite scrapping the fee, Trump is pressing ahead with a naval blockade targeting Iranian trade.

The Strait of Hormuz, described by Trump as under the guardianship of the United States, is a critical passage through which about a fifth of globally traded oil and natural gas passed before the current conflict. The US blockade was set to take effect on July 14 following attacks on UAE tankers.

The regional situation remains tense, with Iran retaliating by attacking a US Army base in Jordan with ballistic missiles. Bahrain, which hosts a US naval base, reported fending off an Iranian aerial attack. Jordan also claimed to have shot down four ballistic missiles, with explosions heard in Bahrain's capital, Manama.

These escalating attacks have cast doubt on a memorandum of understanding signed the previous month, which aimed to bring a permanent halt to the conflict. The ongoing disruption has affected global energy supplies and raised concerns about inflation worldwide.

Oil futures prices initially rose on Tuesday but pared gains following Trump's announcement.

Sources