Iran is reportedly planning a transit fee of $1/barrel on oil tankers transiting through the Strait of Hormuz, the most significant chokepoint in the global energy trade. The suggested fee, to be paid in cryptocurrency, like Bitcoin, indicates a transition to closer state control over sea traffic and an attempt to avoid using the traditional financial system, circumventing sanctions.
The Strait of Hormuz handles around 20% of global oil and LNG transport, and any fluctuation in costs affects global energy prices and networks.
According to the reports, shipping companies will be required to pre-announce cargo volumes, and the Iranian authorities will charge the fee depending on the number of barrels carried. Authorities would then demand payments in a short period of time through digital assets.
This serves two purposes. First, it helps Iran to avoid dollar-based financial systems and international sanctions. Second, it generates a new source of revenue amid geopolitical tensions.
Hamid Hosseini, spokesperson for Iran’s Oil, Gas and Petrochemical Products Exporters’ Union, said, “Iran needs to monitor what goes in and out of the strait to ensure these two weeks aren’t used for transferring weapons.”
Besides the toll, new navigation rules could force the vessels to approach the coast of Iran and be inspected prior to being cleared. While loaded tankers would incur charges, empty vessels are likely to go through without charges.
These types of operational controls might contribute to more transit time, which may further raise logistical expenses and create delays in already sensitive chains of energy supply.
The plan has alarmed oil-importing countries and the global shipping companies. Any interference or increased fees in the Strait of Hormuz has a direct effect on the oil price, inflation expectations, and global trade.
Analysts warn that even a seemingly small fee per barrel could significantly increase shipping costs, especially for large crude carriers transporting millions of barrels per voyage.
India and other economies that are energy-reliant have reportedly protested and pointed out that the strait has always been historically treated as an international waterway with free movement.
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The toll plan comes amid a backdrop of a shaky truce between the US and Iran, which presents uncertainty to an already unstable region. The risk environment is changing, further emphasized by warnings to vessels.
Although the ceasefire has so far calmed tensions, the proposal of the Iranians indicates that they have a wider strategic goal of reestablishing control over energy transit routes, which could redefine maritime norms and also gain greater leverage in oil markets around the world.