Article #78214

US hits targets in port cities of Bushehr and Bandar Abbas while Iran targets Bahrain and Jordan in retaliation

• Middle East crisis live – latest updates

Donald Trump has backed down from a threat that ships would have to pay a 20% fee to the US for “security” in the strait of Hormuz, replacing it with what he described as investment and trade deals with Gulf Arab states as US and Iranian airstrikes resumed for a third day.

The US president said he had decided to scrap the toll “based on highly productive conversations with Middle East leadership”, and touted “massive” investments, just five hours before the toll was due to come into effect. He said the US would continue to blockade Iranian ports.