The Trump administration is rolling out a $20 billion reinsurance program for ships that are worried about incurring losses due to the U.S.-Israeli on Iran and retaliatory strikes against oil-rich Gulf states.
The U.S. International Development Finance Corporation, or DFC, outlined the program after President Trump ordered the agency to come up with ways to protect tankers in the region. The president also said he would consider U.S. Navy escorts for tankers.
Oil prices have surged due to Iran’s clampdown on the Strait of Hormuz, a vital oil artery, and production disruptions across the Middle East.
DFC CEO Ben Black said the new program “will offer a level of security no other policy can provide.”
“We are confident that our reinsurance plan will get oil, gasoline, [liquified natural gas], jet fuel, and fertilizer through the Strait of Hormuz and flowing again to the world,” Mr. Black said.
Reinsurance is often called “insurance for insurance companies,” in that it helps primary insurers transfer some of their risks to another entity.
The DFC said it will work with the Treasury and the U.S. Central Command to help cover losses up to $20 billion on a rolling basis.
Maintaining maritime traffic in the Middle East is a key concern for the administration as it pummels Iran.
Mr. Trump ordered the operation to begin Feb. 28 because, he said, Tehran did not meet his demands regarding its nuclear ambitions, missile programs and support for terror proxies in the region.
The price of U.S. crude oil surged by about 12% to $90 a barrel on Friday.
American drivers are starting to see higher gas prices, too.
The national average for a gallon of regular gasoline reached $3.32 per gallon on Friday, the highest point since September 2024, according to data from the AAA motor club.
• Tom Howell Jr. can be reached at thowell@washingtontimes.com.
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