Trump Proposes $5 Billion Gulf Energy Reconstruction Fund Bypassing Strait of Hormuz

U.S. President Donald Trump has proposed a $5 billion fund to rebuild Gulf energy infrastructure damaged in the war with Iran, the Wall Street Journal reported, citing unnamed Washington and Gulf state sources. The fund, dubbed the Partnership for Allied Trust and Construction (PACT), would also finance alternative oil export routes bypassing the Strait of Hormuz. Washington is seeking a total of $10 billion with contributions from Saudi Arabia, the UAE, Qatar, Bahrain, Kuwait, Iraq, Oman, and Jordan. The plan acknowledges the war, launched by the U.S. alongside Israel in late February 2026, is adversely affecting key Middle East allies' economies. Commentators cited by the WSJ called the proposal premature given the conflict remains ongoing and prospects for permanent peace are slim. Some Gulf states may be reluctant to participate. Iraq has a smaller pipeline route to Turkey, while Saudi Arabia's East-West pipeline is under repair. The UAE plans to double pipeline capacity to Fujairah. Analysts note no export route is fully secure, as pipelines remain vulnerable to attack, making peace with Iran a prerequisite.