Strait Closure Backfires, Trump Finds Loophole

President Trump boldly waives a century-old maritime law to slash skyrocketing energy costs for American families battered by war in the Middle East.

Story Highlights

Trump issues 60-day Jones Act waiver allowing foreign ships to deliver oil, gas, and coal between U.S. ports amid U.S.-Israeli war with Iran.
Gas prices surged 27% to $3.60/gallon after Iran’s Strait of Hormuz closure, hitting working Americans hardest.
Pragmatic move prioritizes consumer relief and national defense over protectionist rules, potentially saving 3-10 cents per gallon.
Complements SPR releases and underscores Trump’s focus on energy independence against global disruptions.

War Sparks Energy Crisis

On February 28, 2026, U.S.-Israeli strikes launched Operation Epic Fury against Iran, closing the Strait of Hormuz and disrupting global oil supplies. Early March saw U.S. gasoline prices jump over 27% per AAA data, with Brent crude exceeding $100 and WTI topping $95. Families faced gas at $3.60 per gallon, up 60 cents from pre-war levels, despite 172 million barrels released from the Strategic Petroleum Reserve over four months. International Energy Agency coordinated additional supplies, yet inflation persisted, squeezing household budgets long strained by past mismanagement.

Trump’s Decisive Waiver Action

March 12 reports indicated plans for a 30-day Jones Act waiver, but President Trump extended it to 60 days, announced Wednesday by Press Secretary Karoline Leavitt. The 1920 Merchant Marine Act requires U.S.-built, flagged, and crewed ships for domestic transport, but only 54 of 7,500 global tankers comply, inflating costs. This waiver permits foreign-flagged vessels to move energy resources like oil, natural gas, fertilizer, and coal, targeting supply chain bottlenecks from Houston to East Coast ports. Leavitt stated it mitigates short-term disruptions so vital resources flow freely.

Jones Act Background and Precedents

Enacted in 1920, the Jones Act bolsters American shipbuilding and maritime security by mandating domestic vessels for inter-port cargo. Critics like Cato Institute’s Colin Grabow argue it curtails options, especially for energy with scarce compliant tankers, driving up prices. Past waivers occurred for hurricanes in 2017 or national defense needs. This wartime action differs, focusing on energy stabilization amid active conflict, paired with potential gas tax holidays. Trump downplayed price hikes on Truth Social, noting benefits for U.S. producers while prioritizing Iran objectives.

Domestic shippers protect their monopoly interests, while consumers and motorists stand to gain from lower fuel costs. The executive branch’s national defense authority enables such waivers, balancing short-term relief against long-term maritime strength.

Trump temporarily waives maritime shipping law to ease energy costshttps://t.co/NjwdxOO7iJ

— Insider Paper (@TheInsiderPaper) March 18, 2026

Impacts on Americans and Economy

Short-term, cheaper foreign shipping could cut transport costs by 10 cents per gallon on key routes, easing inflation for drivers and farmers. East Coast ports see more imports, boosting agricultural and energy flows. Long-term, frequent waivers might weaken the Jones Act, though impacts remain modest at 3-10 cents per gallon per think tanks. Energy Secretary considers naval escorts for Hormuz; potential Defense Production Act use aids California drilling. This bolsters Trump’s narrative of supply chain resilience and domestic production in his second term.

Stakeholders include U.S. Military conducting strikes, Israel as partner, and agencies like AAA and IEA monitoring prices. Bloomberg’s Tyler Kendall notes waiver pairs with SPR efforts, but Hormuz reopening proves key. FreightWaves highlights savings potential amid soaring prices.