US Government To Back Insurance Coverage Of $20B To Try To Get Oil Shipping Again

- Oil and gas shipping in Gulf halted as insurers drop coverage
- US says losses covered up to $20 billion on rolling basis
- Shipping expert: two chokepoints could be under military threat
- US says working with American insurance providers




WASHINGTON, March 6 (Reuters) - The U.S. will provide reinsurance ?for losses up to $20 billion in the Gulf region, to help provide confidence for oil and gas shippers during the war on Iran, the U.S. International Development Finance Corporation said on Friday.
President Donald Trump on Tuesday ordered the DFC to provide political risk ?insurance and financial guarantees for maritime trade in the Gulf after oil and liquefied natural gas ?tanker transit had ground to a halt in the Strait of Hormuz waterway off ?Iran, where ordinarily 20% of global oil moves daily.

Treasury Secretary Scott Bessent told Fox Business Network that the insurance plan combined with potential Navy escorts should quickly fix shipping in the region. "I don't know ?whether it's a week or two weeks, but we are on track to get this solved," Bessent ?said.


"If the ?war ?keeps escalating, the maritime and energy domains will continue to serve as arenas for Iran to retaliate," said Noam Raydan, senior fellow at the Washington Institute for Near East Policy.
Raydan said any calming effect of the coverage could be affected if Iran-backed Houthis resume attacks on shipping in the Red Sea. "If that happens, ?there will be two choke ?points critical to ?global trade under military threat. How will shipping be protected in that case?"

Reuters