Iran wants to charge fees for ships to pass through the Strait of Hormuz as part of its proposals to end the war with Israel and the United States after blocking most traffic through the crucial energy waterway for weeks. The Strait, a strip of water only 34 km (21 miles) wide between Iran and Oman, provides passage from the Gulf to the Indian Ocean and is the main route for about a fifth of world oil supplies and other vital goods including fertilisers.
What Iran is proposing?
Iran wants any permanent peace deal in the war that began with U.S. and Israeli strikes on its leadership on February 28 to allow Tehran to demand fees for ships passing through the strait, a senior Iranian official has told Reuters.
The fee would vary depending on the type of ship, its cargo and unspecified other prevailing conditions, the official said, without elaborating.
Iran’s deputy foreign minister Kazem Gharibabdi said last week that Tehran was drafting a protocol with Oman to require ships to obtain permits and licences to pass the Strait, saying this was intended to facilitate rather than restrict transit.
Oman said it had held talks with Iran on options to ensure smooth transit but did not say if any agreements had been reached.
What happened so far?
A small number of ships have passed through the Strait since Iran’s Islamic Revolutionary Guards Corps blocked it off at the start of the war, firing on some vessels in the Gulf.
There have been reports of at least one payment of $2 million having been made for a vessel to traverse the Strait, but Reuters was unable to confirm that.
Would other countries accept Iran collecting fees?
No such unilateral move to demand fees to traverse a strait has been made in modern history, shipping industry officials said. U.S. President Donald Trump said on Monday that free traffic of oil through the Strait must be part of any peace deal with Iran.
Gulf states relying on energy exports through the Strait are particularly concerned.
The United Arab Emirates said at the weekend the waterway “cannot be held hostage by any country” and free navigation must be part of any settlement of the war.
Qatar’s foreign ministry said all countries in the region have the right to use the Strait freely and any discussions about future financial mechanisms should wait until after it is reopened.
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Could Iran impose fee?
Given Israel and the United States have already spent weeks pounding Iran, it is hard to what the international community could do to force it to allow free passage through the Strait of Hormuz.
Any military endeavour to keep the Strait open would likely involve a major prolonged ground operation along a mountainous coast against well-entrenched Iranian forces able to target vessels from far inland.
China, a world power that still has strong ties with Iran and is the biggest importer of energy shipped through the Strait could have more influence than other countries.
What does international law say?
The UNCLOS maritime convention governing international sea law says states bordering straits cannot demand payment simply for permission to pass through.
However, they can impose limited fees on ships for specific services such as piloting, tugging or port services, though these may not be levied more heavily on vessels from any particular countries.
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Canals, which have been dug rather than occurring naturally, are treated differently to straits. Egypt and Panama each charge fees to pass through the Suez Canal and the Panama Canal.
The Turkish straits – the Bosphorus, Sea of Marmara and the Dardanelles between the Black Sea and Mediterranean – are governed by the 1936 Montreux Convention guaranteeing free passage for merchant vessels in peacetime.
That convention allows Turkey to levy standardised charges to cover the cost of services but does not allow it to impose a general transit fee.
Singapore does not charge a fee to transit the Singapore Strait.
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Are other maritime chokepoints at risk?
There are not many other straits as narrow, significant or fraught as the Strait of Hormuz.
Yemen’s Houthis have periodically disrupted shipping through the Bab el-Mandeb Strait between the Red Sea and Indian Ocean but alternative – though far longer – routes exist.
Vessels travelling between the Indian Ocean and the South China Sea could also find alternatives to the Singapore Strait and the Malacca Strait if these were ever blocked, though there are no threats to do so.
There is also no current likelihood of a threat to passage through either the Strait of Gibraltar between the Atlantic and Mediterranean, or the Oresund between the Atlantic and the Baltic.
