Trump Announces Insurance, Military Escorts For Ships Amid Escalating US-Israel-Iran War

• Trump said the insurance and escorts would be available to all shipping lines, and all ships, especially those involved in the energy trade. 
• Oil prices pared earlier gains after the announcement, while stock markets continued to trade in the red. 
• Trump’s announcement comes amid global maritime insurance mutuals withdrawing war risk insurance coverage for vessels entering the Persian Gulf.

U.S. President Donald Trump on Tuesday announced that the United States Development Finance Corporation would provide risk insurance and military escorts for ships travelling through the Gulf.

In a post on Truth Social, Trump said that this would be available to all shipping lines, and all ships, especially those involved in the energy trade.

“Effective IMMEDIATELY, I have ordered the United States Development Finance Corporation (DFC) to provide, at a very reasonable price, political risk insurance and guarantees for the Financial Security of ALL Maritime Trade, especially Energy, traveling through the Gulf,” Trump said in the post.

“If necessary, the United States Navy will begin escorting tankers through the Strait of Hormuz, as soon as possible,” he added.

Oil prices pared earlier gains after the announcement.

Market Movement

Brent crude oil was 1.44% higher at the time of writing, rising to $77.26, compared to a high of $81.80 earlier in the day. Meanwhile, WTI crude also trimmed some of the gains of the day.

Meanwhile, U.S. equities continued to trade in the red on Tuesday. The SPDR S&P 500 ETF (SPY), which tracks the S&P 500 index, fell 0.82% at the time of writing. The Invesco QQQ Trust ETF (QQQ) was down 1.07%, while the SPDR Dow Jones Industrial Average ETF Trust (DIA) declined 0.67%.

On Stocktwits, retail sentiment around the S&P 500 ETF was in the ‘bearish’ territory.

War Risk

Trump’s announcement comes amid global maritime insurance mutuals withdrawing war risk insurance coverage for vessels entering the Persian Gulf. Meanwhile, the conflict in the Middle East with Iran has sent energy prices soaring, stoking inflation concerns in the U.S.

“No matter what, the United States will ensure the FREE FLOW of ENERGY to the WORLD,” Trump said in the post, adding that more actions were on the table.

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