Iran War: As Oil Prices Escalate, Trump Says US Navy May Escort Tankers Through Strait Of Hormuz
The Strait of Hormuz lies between Iran and Oman on the Arabian Peninsula and connects the Persian Gulf with the Arabian Sea.
Published : March 4, 2026 at 10:18 AM IST
|Updated : March 5, 2026 at 8:11 AM IST
New Delhi: Amid the US-Iran war and escalating oil prices, US President Donald Trump has said that if necessary, the US Navy would escort oil tankers through the vital Strait of Hormuz.
Iran’s Revolutionary Guard Corps (IRGC) officially declared on Monday that the Strait of Hormuz has been closed, warning that any vessel attempting to pass will be "set on fire" or attacked, Al Jazeera reported. Since about a fifth of the world’s oil passes through the strait, the disruption to that traffic caused by the war has pushed oil prices higher.
Trump has also ordered the United States’ development finance arm to provide political risk insurance for tankers carrying oil and other goods through the Persian Gulf "at a very reasonable price." Political risk insurance is a type of coverage intended to protect firms against financial losses caused by unstable political conditions, government actions, or violence.
Speaking at a White House briefing on Wednesday, Press Secretary Karoline Leavitt said that the administration is closely monitoring oil markets and maritime traffic amid 'Operation Epic Fury' against Iran. She said President Trump had already taken steps to stabilise energy markets and protect shipping in the Gulf region. "Yesterday, President Trump announced the US Development Finance Corporation will provide political risk insurance at a very reasonable price for crude carriers and cargo ships operating in and around the Gulf," Leavitt told reporters, adding that the United States Navy could also intervene directly if shipping security deteriorates.
The US Navy has at least eight destroyers and three smaller littoral combat ships in the region. These ships have previously been used to escort merchant shipping in the region and in the Red Sea.
The Strait of Hormuz lies between Iran and Oman on the Arabian Peninsula and connects the Persian Gulf with the Arabian Sea. The shipping lanes in the strait are only two miles wide in each direction, but around 20 per cent of the world's oil and liquified natural gas (LNG) flows through them.
The narrow chokepoint is the main route for oil exported from major Middle-East producers, including Saudi Arabia, Iraq and Iran, and the only route for LNG from Qatar and the United Arab Emirates (UAE) to enter global markets.
Since Israel and the United States launched strikes on Iran on Saturday, the world's largest shipping firms -- Italian-Swiss MSC, Denmark's Maersk, France's CMA CGM, Germany's Hapag-Lloyd and China's Cosco -- have ordered their ships to find shelter and stay safe.
Oil Prices Inch Higher In Early Asian Trade
Oil prices inched higher in early Asian trade on Wednesday, adding to strong gains this week as ongoing violence in the Middle East disrupted supplies. West Texas Intermediate was up 0.5 percent at $74.92. Brent North Sea Crude was not yet being traded. Brent had on Tuesday topped $85 a barrel for the first time since July 2024, with speculation the price could hit $100 per barrel.
But Brent eased later to close at $81.40 per barrel, still up 4.7 percent, after Trump announced that the US Navy would escort oil tankers through the Strait if needed. Equities on Tuesday fell sharply but Wall Street recovered some ground after Trump's comments.
Asian Countries Most At Risk
According to international research group Zero Carbon Analytics, Asian countries are the most at risk from oil and gas supply disruptions in the Strait of Hormuz, with Japan facing the highest risk, followed by South Korea and India.
"Four Asian countries -- China, India, Japan and South Korea -- account for 75 per cent of oil and 59 per cent of LNG flows through the strait. China and India are the largest single destinations for oil and LNG travelling through the strait," the research group said.
"Of the top countries that import oil and gas via the Strait of Hormuz, Japan faces the most direct risk of disruption, due to its high share of oil and gas trade through the shipping route and its reliance on imported oil and gas. South Korea ranks second most at risk, India third and China fourth," it added.
While China and India are the largest single destinations for the oil and LNG travelling through the strait, Japan and South Korea are far more vulnerable to supply shocks. (With Agency inputs)
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