Trump says the US will end $4 billion a year in military aid to Israel by the end of 2026

President Donald Trump said on Tuesday that the United States will end $4 billion in annual military aid to Israel by the end of 2026^3,5. He said Washington would cut off the aid at year’s end because Israel does not “need it”⁴. Trump said he had made a deal with Israeli Prime Minister Benjamin Netanyahu and that the United States would no longer be providing the aid⁸.

Trump said the decision followed an agreement with Netanyahu⁷. Speaking about Israel’s defense budget, he told Israel to “get used to the fact that we won’t” keep paying⁴. When pressed in a Fox interview, he was asked whether he was cutting off $4 billion in military aid specifically⁴.

The surprise announcement came as voters fanned out to cast ballots in the US midterm elections, in races where anti-Israel sentiment is shaping the results^2,6. It sets up a fight in Washington².

Why it matters to investors

The statement collides with commitments already on the books. The current arrangement for US military aid to Israel each year does not expire until September 2028⁵. Congress will likely need to weigh in on any decision between the US and Israeli leaders¹, and lawmakers pass appropriations bills every year to distribute and release the funds⁶.

Israel’s own defense spending has climbed sharply. Under the 2025 budget, the Defense Ministry’s budget swelled to a record NIS 110 billion ($29 billion)³. A loss of US aid would have to be absorbed by that budget or replaced in some other form, a question the announcement did not settle^3,5.

Markets reacted on the day. Brent crude slid 3% after Trump said the US would stop military funding to Israel “by end of this year”⁹. Not all coverage accepts the president’s framing: one analysis said Trump claims he will end military aid to Israel, “but figures tell a different story”⁷.

What to watch

The first test is in Congress, which controls the appropriations that release the money and will likely need to weigh in on the decision^1,6. Lawmakers are also handling a defense bill provision that would deepen US-Israeli military technology ties, which sits awkwardly beside a cut in direct aid⁶.

A second question is how the year-end timetable fits with the existing commitment that runs to September 2028⁵. Trump has said the change rests on an agreement with Netanyahu^7,8, so statements from the Israeli government on its terms will matter.

Oil traders will watch whether the 3% drop in Brent holds as the details emerge⁹. The announcement also lands in the middle of an election that will decide which party controls the Congress that must act on it^1,2.