Washington: The Trump administration has proposed a $10 billion fund to help Middle East countries rebuild energy infrastructure damaged in the Iran war and reduce reliance on the Strait of Hormuz, according to a report in the Wall Street Journal.

Citing US and Middle Eastern officials and documents, the report said Washington would contribute $5 billion and seek matching contributions from eight regional partners - Saudi Arabia, the UAE, Qatar, Bahrain, Kuwait, Oman, Iraq, and Jordan. The initiative, named the Partnership for Allied Trust and Construction (Pact), would be managed by the Development Finance Corporation, a US federal agency whose programmes have historically targeted developing countries rather than wealthy Gulf states.

Discussions are under way and terms could still change, US officials said, adding that it remains unclear whether all named countries will sign on. Some Middle East officials described the initiative as a US attempt to downplay the strategic weight of the Strait of Hormuz and project unity against Iran, cautioning that building a fund to rebuild destroyed sites without a peace deal with Tehran would be premature given the risk of renewed strikes.

Bilal Saab, senior managing director at TRENDS US, was quoted as saying the strategy carried significant risk, noting that larger Gulf producers such as Saudi Arabia and the UAE have alternative routes available, while smaller states remain more dependent on the strait. The seven-month conflict has damaged pipelines, refineries, and gas export terminals across the region, with repair costs estimated in the tens of billions of dollars. Attacks have also disrupted Saudi Arabia's bypass pipeline and Red Sea shipping routes, pushing tanker rates to record levels.

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