U.S. Treasury Secretary Scott Bessent criticized a JPMorgan Chase analysis on Friday regarding a government-backed oil insurance program. Bessent labeled the report terrible and completely irresponsible during an interview on Fox Business.
The dispute centers on the Development Finance Corp. (DFC) and its ability to provide emergency insurance for oil tankers in the Persian Gulf. JPMorgan analysts recently reported that the DFC’s financial headroom was too small to manage risks in the volatile region.
Bessent argued that the bank's assumptions are completely flawed. He noted that specialized DFC coverage is only required for the short transit through the Strait of Hormuz rather than the entire voyage.
The administration recently launched a $20 billion reinsurance program to support regional shipping. Market experts warn that insurance gaps could worsen supply shocks while Brent crude prices remain near $90 per barrel.