Is Iran Cashing in Millions from Strait of Hormuz Blockade?

TEMPO.CO, Jakarta - Throughout history, well-connected people and entities have always capitalized on crises. But the Iran war is taking profiteering to a whole new level, even as the U.S. reportedly offers a 15-point plan to end the fighting.

During the nearly monthlong conflict, allegations have been leveled at fuel retailers — who raised pump prices within hours of the first strikes — major oil companies, which stand to gain windfall margins from US$100 (€86.24)-a-barrel crude, and marine insurers, who increased war-risk premiums by hundreds of percent after Tehran effectively closed the Strait of Hormuz.

But one move trumps them all for sheer audacity. Iran, which has blocked almost all oil and gas tankers from traversing the strait, has reportedly begun charging up to US$2 million (€1.72 million) per ship for "safe passage" through Hormuz.

Lloyd's List, one of the world's oldest and most authoritative maritime publications, reported last week that at least one tanker is believed to have made a payment. 

Has Iran erected a 'toll booth' in Hormuz?

Tehran's move threatens to turn a critical global chokepoint — through which a fifth of the world’s oil and gas supply flows — into a highstakes toll booth.

While several Iranian officials have denied the report, lawmaker Alaeddin Boroujerdi claimed on state TV that such fees were being collected as part of a "new sovereign regime" in the strait, framing the move as an attempt to cover "war costs."

If confirmed, the payment would be a breach of international maritime law, said Robert Huebert, an international relations expert at the University of Calgary in Canada. 

"Freedom of navigation … is the foundation of international maritime trade … the ability to go through these areas without any form of obstruction," Huebert told a podcast by Canada-based Energy Media on Tuesday. "If you were to do that [charge a fee], you would have direct opposition from almost every state."

With more than 3,200 vessels stranded, Peter Sand, chief analyst at the Copenhagen-based shipping analytics firm Xeneta, downplayed the importance of the fee for helping reopen the narrow waterway.  

"As high as it may seem, [the US$2 million transit charge] is not the essential factor," Sand told DW. "What matters is that it's still unsafe to pass through [Hormuz]."

Even so, the willingness of major oil and gas importers to engage in direct talks and pay a staggering fee per vessel, in addition to sky-high insurance coverage, underscores the growing desperation among fuel-dependent nations to secure even minimal supplies through the strait. 

"Some [countries] may want to pay," Sand added. "It is a small final premium to pay to ensure some sort of uninterrupted energy supply." 

Payment made despite sanctions on Tehran

Lloyd's List said it was unclear how the transaction was made as Iran remains subject to international sanctions, which make it difficult for Tehran to receive dollar-denominated payments through Western financial channels.

The maritime publication reported that India, Pakistan, Iraq, Malaysia, and China are speaking directly with Iranian officials to arrange safe passage for their ships. 

Bloomberg, which also reported on the fee, cited unnamed sources as saying that several vessels have paid to traverse the strait, although the payment doesn't appear to be systematic.

Tehran is considering formalizing the fee as part of any peace deal with the U.S. and Israel, one of Bloomberg's sources added.

Iran to smooth transit for 'non-hostile' tankers

In a further development, Iran on Tuesday sent a letter to member states of the International Maritime Organization (IMO) saying it would now allow "non-hostile vessels" to transit Hormuz, with coordination from Tehran.

"Until now, [Iran] has approved between three and five transits per day," Sand said, "[Now Tehran is saying] if you're not an enemy of Iran, the strait is open for you."

In the meantime, a spokesperson from the IMO told DW that the organization is working to establish a "provisional and urgent measure to facilitate the safe evacuation of merchant ships currently confined within the Gulf region."

Before the crisis worsens further, the IMO said it is critical to protect the lives and welfare of stranded seafarers, while pushing for willing ships to transit Hormuz without being attacked.

Naval escorts not a 'long-term solution'

Looking further ahead, U.S. President Donald Trump has been pressing European NATO allies to join a multinational naval patrol or escort mission in the Gulf to safeguard commercial shipping.

European countries, however, have largely resisted immediate involvement. But many, including Germany, France, and Italy, have indicated they would be prepared to contribute to a naval escort or patrol mission once active fighting ends.

The IMO said that while Navy escorts have been used before, including during recent attacks by the Iran-backed Houthis on ships in the Red Sea, they do not provide "a sustainable or long-term solution."

"There must be a multilateral solution to de-escalate the situation and allow civilian seafarers and ships to be evacuated to safety," said the IMO spokesperson.

Read: US Reportedly Sent Iran 15-Point Plan to End War

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