President Donald Trump backed away from his plan to impose a 20% charge on cargo shipments through the Strait of Hormuz after US allies in the Gulf urged him to drop it.
Trump announced the decision Tuesday, one day after rolling out the fee, saying that the expected revenue would be replaced by forthcoming direct investments in the US from Gulf states. He did not specify a dollar amount or which countries would participate.
“I have decided to replace the 20% United States Reimbursement Fee with Trade and Investment Deals that the various Gulf States will be making into the United States,” Trump posted on social media.
Even as Trump dropped that plan, the US announced it had resumed its blockade on Iranian shipping to and from its ports and coastal areas, effective at 4 p.m. Washington time.
US Central Command said in a post on X that it completed a seven-hour wave of strikes against dozens of targets near the Strait of Hormuz and along Iran’s coast aimed at degrading Tehran’s ability to threaten commercial shipping.
Trump discussed broadening the offensive against Iran beyond the current campaign around the strait during a Situation Room meeting Tuesday, Axios reported, citing three people familiar with the discussions.
Trump’s reversal on fees underscored shifting US policy toward the vital waterway, which carried roughly one-fifth of global oil flows before the war. US officials have alternated between insisting passage should remain free and debating who, if anyone, should charge for transit, while Iran maintains it controls the strait.
The reversal also reinforced the “TACO” — or Trump Always Chickens Out — dynamic that emerged among traders last year as the president vacillated over his tariff policies.
Asked by reporters why he abandoned the proposal, Trump said Gulf leaders from Saudi Arabia, Qatar, Bahrain, Kuwait and the United Arab Emirates urged him to pursue investment commitments instead. “I don’t like the concept of a fee,” he said.
It’s unclear whether any Gulf states have made new financial pledges. At least one regional government has said it had not agreed to increase its existing commitments in exchange for waiving the transit fee through the strait, according to a person familiar with the matter.
In a Fox News interview that aired Tuesday evening, Trump said US strikes against Iran would broaden to attacks on bridges and power stations next week “unless they get to the table and negotiate.” He has previously made similar threats to attack civilian infrastructure — which critics say could constitute war crimes if carried out — but has not followed through.
Global crude oil benchmark Brent advanced toward $86 a barrel after surging 11% in the previous two sessions as Trump said the US would continue striking Iran and reiterated threats to target infrastructure.
Source:
Bloomberg; July 15, 2026 (local time); Trump Drops 20% Fee for Hormuz Cargo After Gulf Pressure; https://www.bloomberg.com/news/articles/2026-07-14/trump-backs-off-20-fee-for-strait-of-hormuz-shipments?srnd=homepage-asia
