Washington: The United States is preparing a government-backed insurance program for ships passing through the Strait of Hormuz, aiming to restore tanker traffic and stabilize global oil supply amid rising security risks in the region.
US Transportation Secretary Sean Duffy said the initiative will help vessels operate more safely through the strategic waterway, which handles a significant share of global energy shipments.
US prepares insurance plan for Hormuz shipping route
The proposed Hormuz ship insurance program will provide financial protection for vessels navigating the high-risk zone.
Duffy said the insurance mechanism is designed to reduce risks for shipping companies and encourage the return of tanker traffic through the region.
“As soon as we get more clarity on security risks, not only the United States but also partner countries will join us,” he said.
Escort support may boost tanker movement
The United States is also assessing plans to deploy military escorts for merchant vessels in coordination with partner nations.
According to Duffy, countries participating in maritime security operations may join the initiative to ensure safe passage for commercial ships.
He said the combination of naval escorts and insurance coverage could help restore confidence among shipping companies.
“When these escorts appear and we have insurance, you will start to see the flow of oil,” he added.
Program ready for launch as security review continues
Duffy said the insurance framework is almost ready for rollout, with final decisions depending on ongoing security assessments.
The US military is currently evaluating conditions in the region before approving escort operations.
“We are ready in terms of insurance. It is ready to launch. It could be a day, it could be a week,” he said.
Strait of Hormuz critical to global oil trade
The Strait of Hormuz is one of the world’s most important energy corridors, handling a large share of global crude oil and LNG shipments.
Any disruption in the region can impact oil prices, shipping costs and global trade flows.
Market participants say restoring safe passage through Hormuz is essential to stabilizing energy markets and reducing volatility caused by geopolitical tensions.
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