US President Donald Trump on Monday (local time) announced that American forces will reimpose a naval blockade in the Strait of Hormuz targeting Iran, while allowing vessels from other nations to continue transiting through the strategic waterway.

Speaking to reporters after signing an Executive Order, Trump said the blockade would apply only to Iran and those doing business with Tehran.

"We're hitting them (Iran) very heavy tonight... We have tremendous amounts of ammunition. We're hitting them very hard, and it'll continue, and we'll see what happens. We're knocking out all of their offensive capability, and we're controlling the strait (Strait of Hormuz). We're putting the blockade back. It's a blockade, not for anybody but Iran. In other words, anybody doing business with Iran can't go through. Everyone else will be able to go through... The blockade is probably more effective even than hitting them. But I think the combination is the thing that really does it," Trump said.

The US President claimed that American military operations have significantly degraded Iran's military capabilities, including its navy, air force, missile and drone production.

"We've been here for four months. I think we've done a lot. We've knocked out their navy in one month. We knocked out their air force, which is non-existent. We knocked out most of their missiles and drones. We knocked out their drone manufacturing capability by about 92 per cent. Their missile manufacturing capability, we knocked out by 89 per cent. They have a little capability left, but they don't have any capability against us. This is almost a military skirmish," he said.