President Donald Trump announced on Tuesday that he is withdrawing a proposal to impose a 20% toll on cargo traveling through the Strait of Hormuz. Speaking at the Oval Office, the president stated that the decision followed communications with leaders from Gulf nations who requested an alternative arrangement to the maritime fees.
The president reported that "kings and emirs" and other regional leaders proposed increasing direct investment in the United States instead of paying the transit tolls. Trump told reporters that these nations expressed a willingness to invest "billions and billions of dollars" in the U.S. economy, a prospect he characterized as preferable to the fee system.
Trump stated that he now favors trade-based agreements over tolls for the strategic waterway, noting that he did not believe it was appropriate to charge transit fees for the strait. The initial toll proposal had been part of an effort to recoup costs for U.S. security operations in the region, but will now be replaced by the discussed investment commitments from Gulf allies.