Posted on 03/25/2026 6:58:51 AM PDT by PGR88
When the seven P&I clubs belonging to the International Group issued 72-hour cancellation notices for war risk coverage in the Persian Gulf on March 5, they did not just raise costs. They made transit impossible.
P&I clubs insure roughly 90 percent of the world’s ocean-going tonnage. Without their coverage, ships cannot sail. Port authorities will not let them dock. Banks will not finance the cargo. Charterers will not book the vessel. The entire system, from loading berth to discharge terminal, is underwritten by a chain of contracts that begins with a club in London, Oslo, or Tokyo. When the clubs pulled war risk extensions, that chain broke. Not for a few ships. For the global fleet.
War risk premiums jumped from 0.25 percent to 1 percent of hull value, renewable every seven days. VLCC charter rates quadrupled to nearly $800,000 per day. Over 1,000 vessels are now trapped in the Persian Gulf, burning charter costs with nowhere to go. By March 3, only four ships crossed the Strait, down from a seven-day average of seventy-seven.
Then Trump did something that almost nobody in the press understood.
He ordered the U.S. International Development Finance Corporation to create a $20 billion maritime reinsurance facility, with Chubb as lead underwriter, making the United States government the insurer of last resort for Gulf shipping. A sovereign nation positioned itself as the backstop for war risk insurance on the world’s most critical maritime chokepoint. The DFC facility, coordinated with US Central Command and Treasury, offers hull, machinery, and cargo coverage on a rolling basis to eligible vessels.
The United States now controls the on/off switch for the Strait of Hormuz. Not through naval firepower. Through insurance.
(Excerpt) Read more at gcaptain.com ...
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It continues the squeeze on China. It reopens markets for Venezuela. It makes the Gulf less dominant. It raises prices for American exports at the cost of domestic inflationary pressures.
Not all bad. Not all good either. Domestic pressure on the GOP in the mid-terms is the most likely problem. Fix the ballot counting system or we’re toast.
With the straight closed, I ran delivers no oil.
The Gulf States can carry on deliveries via pipelines to the Red Sea and Arabian Gulf.
Consider the source...
There is a ‘Wag the Dog’ element to the MSM’s coverage of this Iran “War”.
“One major concern is that China may try to take advantage of US engagement in the Middle East and try to invade Iran . US control of oil to China blocks this so regardless of anything else. expect the Trump Administration to make efforts to control the flow of oil to China to block Chinese aggression for the indefinite future.
China is going to have a hell of a time with Taiwan, do not think they have the deep blue navy to get more than 1000 to IRAN. China vs Taiwan is an equal fight, China vs Taiwan/1 US carrier group isnt. With the amount of US subs launching conventional tomahaks in the 2nd week, if Taiwan has an airforce left. The only real fear of the south china sea is the N Korea start a war they are not partipants in by week 2.
China and the rest of Asia are the ones hurt by closing the straight. We have many allies there, AUS in particular. They’re already experiencing No Gas at some stations.
A most interesting read. John Conrad is probably the most knowledgeable writer about the maritime industry. This makes liberals dumber than they look, which is not an easy feat.
It’s like the emergency room doctor treating the stabbing victim who he recognized as the one who held him up with a knife 2 days earlier. “I don’t think you’re gonna make it”
Iran is letting approved ships through.
There's no legal mechanism under U.S. federal law or international maritime law for the U.S. Navy to be serving as escorts for foreign-flagged commercial vessels.
In the case of the Persian Gulf (in general) and the Strait of Hormuz in particular, this is further complicated by the fact that maritime law is based on the U.N. Convention on the Law of the Sea (UNCLOS). Among the 150+ nations that have ratified UNCLOS, two notable exceptions include Iran and the United States.
Fro starters, the Marines from Japan are not transiting the Pacific. Go from there about the cracks in this editorial.
Gee... now that you mention it...
Invade Iran? Come on! While they got the young men to spare how do they get there?
What’s a million Chinese?
Meanwhile...
Jim Ferguson
@JimFergusonUK
🚨 A-10 WARTHOGS AND APACHES ENTER THE FIGHT IN HORMUZ
U.S. forces have escalated operations in the Strait of Hormuz.
According to statements attributed to General Dan “Razin” Caine:
A-10 Warthogs are now actively targeting Iranian fast attack boats
AH-64 Apache gunships are engaging drones and militia-linked threats
This is a significant shift.
The A-10 is built for one purpose:
Close-range destruction of ground and surface targets.
And now it’s being used to hunt fast-moving vessels in one of the world’s most critical waterways.
At the same time, Apaches are expanding operations across the southern flank and into Iraq — targeting threats before they can escalate.
This marks a new phase:
Not just strikes from above…
But persistent, close-range battlefield control.
And in a chokepoint like Hormuz—
That changes everything.
7:05 AM · Mar 25, 2026 52.3K Views
https://x.com/JimFergusonUK/status/2036761323837559238
FWIW, I’m wondering if he means more A-10s, because I thought A-10s were already in use in the war. And in some interesting ways.
The Strait is not closed...Iran controls whose oil get through.
“It makes the Gulf less dominant.”
One factor that makes the Gulf “less dominant” is the infrastructure damage that will take years to repair. That’s not just damage to the Iranian side, but to the Arab side as well.
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