Summary

Will Donald Trump's 'Project Freedom' reopen the Strait of Hormuz or reignite war with Iran? Donald Trump has pledged to get traffic moving through the jammed Strait of Hormuz again, defying Iranian warnings not to challenge its blockade. But the US president's so-called Project Freedom is a risky exercise that threatens to reignite the war with Iran. Only a couple of ships made it through the strait earlier this week before the US and Iran exchanged fire and Gulf states came under attack. Here's what's happening in the strait, and what could happen next. First, catch me up. What is Project Freedom? Since the start of its war with the US and Israel, Iran has blocked nearly all shipping through the Strait of Hormuz in retaliation. For more than two months, and despite a ceasefire now in place, thousands of ships have been stuck in the Arabian Gulf, severely affecting oil exports and disrupting international energy supplies. The US has imposed its own naval blockade on Iranian ships in return. On Monday, local time, Mr Trump announced the US would guide stranded ships "safely out of these waterways, so that they can freely and ably get on with their business". He described the effort as a "humanitarian gesture" to aid vessels from countries not involved in the war, and dubbed it Project Freedom, with the ultimate goal to fully reopen the strait. Any interference would "have to be dealt with forcefully", Mr Trump threatened, though US officials have since stressed it is a "defensive operation". On Tuesday, America's top general, Dan Caine, said US forces had established an "enhanced security area" on the southern side of the strait. He said guided-missile destroyers and other warships were detecting and defeating Iranian threats, including fast boats and one-way attack drones. The project involved more than 100 aircraft and 15,000 US service members, he said. Is it working? Before the war, about 138 ships crossed the Strait of Hormuz each day, according to the Joint Maritime Information Centre. So far, just two American-flagged merchant ships have made it through the strait as a result of Project Freedom, the US says. There are still more than 1,550 commercial ships "trapped in the Arabian Gulf, unable to transit", General Caine said. More than 22,500 mariners are stranded on board. "We anticipate more [ships] to transit over the coming days," General Caine said, but he did not give a sense of how many or how quickly. "I'll let Centcom talk to the number of ships [we] are going to take through because they're the nearest ones to talking to the commercial shippers and I don't want to get out in front of them," he said. America's limited success to date appeared to represent more of a "branding exercise" than a broader reopening, said Helima Croft, the global head of commodity strategy at investment bank RBC Capital. "Many shipping companies are saying that it is still not safe to go through the Strait of Hormuz," she told CNBC. Several shipping groups have told The New York Times that the Project Freedom plan is not enough to give them confidence to make the trip. "There is much uncertainty around what Project Freedom means in practice," a spokesman for the International Chamber of Shipping told the Times. Insurance is another key factor in whether shipping companies are prepared to make the risky transit. The US government has been working on a program to ensure insurance is available for ships in the strait. At least seven insurers have agreed to provide reinsurance, and thereby share the risk. The US is meanwhile still blockading Iranian shipping. Six ships tried to depart from Iranian ports after Project Freedom got underway, according to the US. "They were all turned around," US Secretary of Defense Pete Hegseth said. Is the ceasefire over? The US says Project Freedom is wholly independent from Operation Epic Fury, the term it uses to describe the war on Iran, which is now effectively under a perpetual ceasefire pending further negotiations. But the ceasefire did not stop Iran from retaliating and attacking Oman once, and the United Arab Emirates three times, on Monday. A South Korean ship was also hit. General Caine said Iran also "launched cruise missiles, drones, small boats at US forces" but that they were "defeated". "Thus far, today is quieter," he said on Tuesday. In Mr Hegseth's assessment, however, none of these attacks affect the standing of the ceasefire. "We expected there would be some, some churn at the beginning which happened," he said. "We would urge Iran to be prudent in the actions that they take to keep that underneath this threshold." He added that the US was "not looking for a fight" in the strait. "Right now the ceasefire certainly holds, but we're going to be watching very, very closely." General Caine echoed the sentiment, saying Iran's actions since the ceasefire was announced on April 7, which have included firing at commercial vessels, seizing container ships and attacking US forces, fell "below the threshold of restarting major combat operations at this point". How else is Iran responding? After the attacks on the UAE and Oman, Iranian Foreign Minister Abbas Araghchi declared that "Project Freedom is Project Deadlock". "Events in Hormuz make clear that there's no military solution to a political crisis," he wrote on X. "As talks are making progress with Pakistan's gracious effort, the U.S. should be wary of being dragged back into quagmire by ill-wishers. So should the UAE." Iran's military has continued to warn ships not to risk traversing the strait without permission from, and coordination with, its military. On Tuesday, Iran's Press TV reported that Iran had set up a new mechanism to manage the transit of vessels through the Strait of Hormuz. It warned the US Navy to stay out of the strait and issued a new map of the waterway showing an expanded area of Iranian control, Reuters reported. Washington has indicated it is still negotiating with Tehran with the hope of reaching some sort of peace deal, which would include reopening the strait. The White House also informed Iran about its Project Freedom plan on Sunday and warned it not to interfere, Axios reported. "We're communicating both overtly and quietly to the Iranians to allow this defensive operation to happen on behalf of the world," Mr Hegseth said. "There are some actions the IRGC [Islamic Revolutionary Guard Corps] takes sometimes that are outside the bounds of what maybe Iranian negotiators would like. That's their job to rein that in and ultimately create a condition for a deal." What happens next? Mr Rubio said the successful transit of two US-flagged ships had demonstrated Project Freedom's "proof of concept". "They're now safely on their way," he said. "The US military is deploying the necessary assets to extend this defensive umbrella over commercial shipping." But there was a wide range of possible scenarios that could play out from here, said Maisoon Kafafy, senior adviser for Middle East programs at the Atlantic Council think tank. "The most constructive path would be one where the current military pressure creates enough leverage to produce a serious diplomatic agreement; one that addresses not just the immediate passage question but the underlying security architecture," she said. "The more concerning trajectory is a prolonged stand-off in which each side's escalatory moves narrow the space for the other to de-escalate without appearing to capitulate." The Trump administration has stressed its operation is temporary, and it plans to soon hand responsibility for the strait over "to the world". During his press conference on Tuesday, local time, Mr Hegseth again specifically called out Australia. "We hope South Korea would step up, just like we hope Japan would step up, just like we hope Australia would step up, just like we hope Europe steps up," he said. "But we're not waiting for them to do so. We're looking to set the conditions to hand to them." Australia has previously indicated it is discussing options with the US, but neither country has publicly outlined a specific proposal or plan to get involved in the strait. When, and if, conditions allow commercial shipping to resume safely, the recovery process will take time, Ms Kafafy says. "Insurance premiums tend to lag behind political developments, routing decisions are made weeks in advance, and market confidence rebuilds more slowly than it dissolves," she told the ABC. "The commodity disruptions — in energy, fertilisers, and industrial inputs — have already begun restructuring some trade flows in ways that will not simply reverse overnight."