Donald Trump has backtracked on his plan to impose a 20 per cent fee on cargo passing through the Strait of Hormuz, just a day after announcing it.
The controversial plan was announced alongside the confirmation of the reinstatement of a blockade on Iranian ships.
The US President confirmed trade and investment deals with the Gulf states will replace the proposed fees for ships to pass through the channel.
On Truth Social, he wrote: “Based on highly productive conversations with Middle East leadership, I have decided to replace the 20% United States Reimbursement Fee with Trade and Investment Deals that the various Gulf States will be making into the United States.”
He added the US would continue to maintain a “full blockade", but only on ships heading to and from Iranian ports.
The comments were posted following continued tension across the region, as earlier today Iran fired strikes at Bahrain and Jordan, following a five-hour attack from the US on Iran.
The strikes came after Mr Trump confirmed to the media that he was going to “hit them very hard” overnight.
He told US media: “We're going to hit them very hard tonight, and we're going to hit them hard tomorrow – and there's not a damn thing they can do about it.
Donald Trump has retracted the 20 per cent toll less then 24 hours after announcing it
|GETTY
“They have nothing. They have nothing going other than they have big mouths... I got to know them, and they're stone cold crazy.
“These people are crazy... To them, deals are made to be broken. They are extremely unreliable people - and, frankly, if they ever had a nuclear weapon they'd use it within one day.”
The Commander-in-Chief later confirmed to reporters the US was attacking Iran's "capabilities related to the Strait of Hormuz".
Mr Trump formally told lawmakers this weekend the US was once again at war with Iran.
LATEST DEVELOPMENTS
Strikes have continued to throughout the Middle East overnight
|GETTY
That gives his administration another 60-day period to use the military in the Middle East without the need for congressional approval.
In a letter to Congress on July 10, obtained by Politico, the President said the strikes which began on July 7 represent "military action consistent with my responsibility to protect Americans and United States' interests both at home and abroad".
Mr Trump called himself "the guardian of the Hormuz Strait" on social media when he announced the 20 per cent fee on Truth Social.
"The Hormuz Strait is OPEN, and will remain OPEN, with or without Iran," he said.
"The USA will be, from this point forward, known as 'THE GUARDIAN OF THE HORMUZ STRAIT,' but as such, and as a matter of FAIRNESS, will be reimbursed, at the rate of 20 per cent on all cargo shipped, for any and all costs necessary to do the job of providing safety and security to this very volatile section of the world."
Around 50,000 US troops were involved in the strikes overnight.
The attacks on Jordan were in response to thus, with the newly proscribed Islamic Revolutionary Guard Corps saying, "You know very well that not only do we not have any enmity with your country, but we also love you, the noble people, who understand the pain and oppression of the Palestinian people more than any other nation.”