US will use frozen Iranian assets to cover damages from shipping attacks in Hormuz: Trump

President Donald J. Trump announced that the United States would draw on Iranian funds under American control to compensate for damages caused by recent attacks on commercial shipping in the Strait of Hormuz, describing the move as a fair way to hold Tehran accountable without burdening American taxpayers.

Speaking to reporters aboard Air Force One as he traveled to an event in Michigan, Mr. Trump addressed the issue directly. “We’re going to use Iran’s money to pay for the damage they did,” he said. “In other words, the Iran money that we control will be used to pay for damages.”

The president’s remarks come amid heightened tensions in the Gulf, where Iranian forces or proxy groups have been linked to assaults on commercial vessels, disrupting a critical chokepoint for global oil shipments.

Details on the precise extent of the damages, the total value of frozen Iranian assets to be tapped, and implementation timelines were still being finalised by the Treasury Department, according to officials.

Treasury Secretary Scott Bessent has been advancing the proposal since at least June, with assessments underway for repair costs to affected ships, cargo losses and impacts on regional allies.

Administration supporters framed the plan as a straightforward exercise in accountability, redirecting Tehran’s own resources against the consequences of its actions.

Critics, however, cautioned that drawing down the assets could diminish US leverage in broader negotiations over Iran’s nuclear program and regional security.

The comments reflect Trump’s long-standing hard-line approach toward Iran, which has included the reimposition of sweeping sanctions during his first term and continued pressure in his current administration.

As of Monday evening and into Tuesday, there were no immediate indications of new military escalations, though the president has previously warned of “strong military action” if threats to the Strait of Hormuz persist.

White House officials did not immediately respond to requests for further comment on the legal basis for reallocating the funds or potential diplomatic repercussions.

The development underscores ongoing volatility in US-Iran relations, even as global energy markets monitor the situation closely for any further disruptions to shipping routes vital to international trade.