US to offer insurance coverage for ships in Gulf region due to attacks

US Navy to Escort Oil Tankers through Strait of Hormuz if Necessary

The United States government has announced that it will provide insurance to ships traveling through the Gulf, including oil tankers, in response to Iran’s closure of the Strait of Hormuz. The move aims to mitigate the impact of the strait’s closure on global energy supplies.

According to a statement from US President Donald Trump, the United States Development Finance Corporation (DFC) will offer discounted risk insurance and guarantees for maritime trade, particularly in the energy sector. This initiative is expected to be available for all shipping lanes.

If necessary, the US Navy will begin escorting tankers through the Strait of Hormuz, as soon as possible. The statement also emphasizes that the United States will ensure the free flow of energy to the world.

The Strait of Hormuz is a critical waterway connecting the Gulf to the Indian Ocean, with approximately 20% of global oil supplies passing through it. The closure of the strait has led to an increase in oil prices by over 15%, with some insurance companies cutting back coverage amid Iranian attacks on energy installations in the region.

The US government’s move is aimed at stabilizing the energy market and mitigating the impact of rising oil prices on consumers. However, the statement does not provide further details on the terms and conditions of the insurance policy or the specific measures being taken to address the situation.

As a result of the increased tensions, some insurance companies have reduced their coverage, while others have seen an uptick in demand for protection. The US government’s initiative is expected to help alleviate concerns among ship owners and operators.

Source: Al Jazeera