US Proposes $5 Billion Fund to Rebuild Gulf Energy Infrastructure

WASHINGTON: The Trump administration has proposed investing $5 billion in a new fund aimed at helping Gulf countries rebuild energy infrastructure damaged during the conflict with Iran and develop alternatives to the Strait of Hormuz for oil and gas exports.

The proposal was reported by The Wall Street Journal and subsequently reported by Reuters, citing US and Middle Eastern officials and documents. Reuters said it could not immediately independently verify the report.

Under the proposal, the United States would provide $5 billion to a fund known as the Partnership for Allied Trust and Construction (PACT).

Washington is seeking another $5 billion collectively from Saudi Arabia, the United Arab Emirates, Qatar, Bahrain, Kuwait, Oman, Iraq and Jordan.

The fund would be managed by the US Development Finance Corporation, according to the reports.

The proposed initiative is intended to support the reconstruction of Gulf energy infrastructure and reduce regional dependence on the Strait of Hormuz for energy exports.

The proposal comes after months of conflict involving Iran and attacks that damaged energy infrastructure across the Gulf region.

The conflict has disrupted oil and gas transportation, increased shipping costs and contributed to pressure on international energy markets.

Some Gulf officials have raised concerns about beginning major reconstruction projects before a broader peace agreement is reached, particularly because renewed attacks could damage rebuilt facilities.

The proposed fund would also support efforts to develop alternative routes for exporting oil and gas without relying entirely on the Strait of Hormuz.

The initiative remains under discussion, and US and regional officials have indicated that its terms could change before any final agreement is reached.

The proposal highlights the economic and strategic importance of reducing vulnerabilities created by disruptions to major energy shipping routes.