Bessent: US Prepares “Hormuz Insurance,” Market Monitors Tanker Flow
US Treasury Secretary Scott Bessent said a US shipping insurance program aimed at encouraging ships to return to transiting the Strait of Hormuz will begin soon, a move seen as potentially helping restore the flow of a significant portion of global oil and gas supplies from the Gulf region.
Bessent's remarks came Thursday (March 26) during a White House meeting with President Donald Trump, weeks after Trump first announced that the US International Development Finance Corporation (DFC) would provide insurance coverage, along with naval escorts, to ensure safe passage for oil tankers and other vessels in the region.
Although the program was announced on March 3, market sentiment has highlighted the lack of evidence that vessels using the facility have actually passed through Hormuz, a narrow waterway that serves as a chokepoint for about a fifth of global oil and gas flows. Bessent stated that the oil market is “well-supplied” and that the US government has taken steps to make supplies stranded at sea available to the global market.
The comments come amid concerns that the spike in oil and gas prices during the Iran war could persist even after the conflict subsides. Since the war began on February 28, commercial tankers have largely avoided transiting Hormuz, while Iranian attacks have also reportedly damaged refining and gas processing infrastructure in the region, adding to supply risks.
Bessent said tanker traffic has begun to pick up and could increase further in the coming days. He also assessed that the US economy is better able to withstand short-term energy disruptions due to policies that encourage increased domestic oil and gas production, and said the American public is willing to tolerate short-term price volatility for long-term stability.
The Trump administration has reportedly taken steps to contain prices and ease supply concerns, including waiving certain domestic shipping restrictions and releasing millions of barrels of oil from emergency reserves. Trump has also mentioned other options such as suspending federal gasoline taxes—which generally require Congressional approval—and floated the idea of “taking over” Iran’s oil, without providing details.
Source: Newsmaker.id
