By Scott Bessent — US Treasury Secretary Scott Bessent announced that a new insurance program aimed at boosting shipping through the Strait of Hormuz will start soon. This initiative is expected to help restore the flow of a significant portion of the world’s oil and gas supplies.

Bessent shared these updates during a meeting with President Donald Trump's cabinet at the White House. This news comes a few weeks after Trump initially revealed that the US International Development Finance Corporation would provide insurance guarantees and naval escorts to ensure safer passage for oil tankers through the strait.

Even though the program was first introduced on March 3, there has been no confirmation that any ships benefiting from this initiative have successfully navigated through the strait, which is a critical chokepoint for around 20% of global oil and gas shipments.

“The oil market is well-supplied. We’ve implemented measures to ensure that oil supplies stranded at sea are accessible to the global market,” Bessent said. “The Development Finance Corporation’s maritime reinsurance program, combined with Central Command’s involvement, will soon provide shippers in the Gulf region with an unprecedented level of security.”

Bessent's comments come amidst growing worries about rising oil and gas prices due to the conflict with Iran, and the concern that energy supply disruptions may continue even after the fighting stops. Trump has indicated a postponed threat to strike Iranian power plants, which was met with Iran's threat to completely close the Strait of Hormuz and target energy facilities in the region.

Although Trump mentioned that Iran allowed 10 tankers to transit the strait, commercial vessels have mostly stayed away since the conflict began on February 28. Iranian attacks have also damaged refining and gas processing infrastructure in the area, complicating any quick resolution.

Insurance for vessels is still available, although it comes at a high price. The Lloyd’s of London insurance market continues to cover ships traveling through the strait, according to CEO Patrick Tiernan. This indicates that the real barrier for ships is more about the threat of military strikes from Iran than the availability of insurance.

Bessent stated that tanker traffic in the Gulf is already beginning to increase and is expected to grow in the coming days. “We are seeing more movement in and out of the Gulf today — more than yesterday, and this is just the start,” he said. “I am confident that shipping traffic will continue to rise daily, even before we secure the straits.”

Rising oil and gasoline prices are threatening to erase some of Trump's economic achievements from his first year back in office and could pose challenges for Republicans looking to maintain control of Congress during the midterm elections in November.

However, Bessent believes that the US economy is better equipped to handle short-term energy disruptions due to Trump's policies that have encouraged increased domestic oil and gas production. He noted that Americans may be willing to accept higher prices in the short term if it leads to greater stability in the long run.

“Many underestimate the American people's willingness to face short-term volatility for 50 years of safety on the other side of it,” Bessent said.

The Trump administration has already taken steps to mitigate prices and address oil supply concerns, including issuing waivers for maritime transport restrictions and releasing millions of barrels from the emergency stockpile.

Alternative measures are also being considered. Trump mentioned on Thursday that one option could be suspending the federal gasoline tax, which typically requires action from Congress. “The gas tax is something we have ready if we feel it’s necessary,” Trump stated.

Another potential plan, Trump suggested, could involve taking control of Iran’s oil. While he didn't elaborate on this during Thursday's remarks, it could hint at seizing or occupying Kharg Island, a major center for Iranian oil production.