Maritime experts and global shipping associations are raising alarms over Iran's proposal to impose tolls on vessels passing through the Strait of Hormuz. They contend that such a move would fundamentally undermine the principle of freedom of navigation that has been a cornerstone of global trade since World War II. The United Nations Convention on the Law of the Sea (UNCLOS) guarantees ships the right to "innocent passage" through territorial waters without incurring transit fees, making Iran's demands legally contentious. Agreeing to these tolls, experts warn, would set a dangerous precedent, potentially encouraging other strategically located nations to levy similar charges on vital waterways worldwide. This would blur the line between internationally governed straits and commercially operated canals like Suez or Panama.
Leading global shipping associations have sent a letter to the UN, stating that compulsory transit or service fees, even if not explicitly called tolls, would be a "toll in all but name." They argue this would significantly depart from established international practices and harm the global economy. Al Jazeera reported that eight of the world's largest shipping associations urged the United Nations to oppose the tolls, emphasizing that internationally recognized navigation rights should not be compromised for political negotiations. The head of the UN's International Maritime Organization, Arsenio Dominguez, has previously stated that imposing fees in such straits would violate international law and set a "very detrimental" precedent.
Analysts predict that any agreement allowing Iran to charge tolls, even if temporary, would fundamentally alter the risk landscape for shipping in the Strait of Hormuz. This could lead to higher insurance costs and an increased reliance on naval escorts. The regional conflict has already shown how minimal force can disrupt global shipping, leading to increased risk premiums and higher insurance rates even without formal tolls. Deborah Elms from the Hinrich Foundation noted that a permanent toll system would disproportionately affect Asia, which heavily relies on the Gulf's energy exports, potentially leading to increased energy prices, inflation, and economic uncertainty globally. The impact could be particularly acute for natural gas shipments, while much of the oil might be rerouted through pipelines.
While some analysts suggest that the era of "free seas" is unraveling due to tensions in choke points like the Strait of Hormuz and the Red Sea, the head of the IMO maintains that UNCLOS rules are clear and do not require revision. He reiterated that there is "no legal basis for any tolls, fees or customs" on straits used for international navigation. However, the current situation, described as "conditional passage" by some, highlights how military pressure and non-state actors can stress-test existing maritime laws by imposing commercial risks, as seen with vessels paying over $1 million for preferred transit slots through the Panama Canal due to Middle East disruptions.
In addition to potential tolls, the broader instability in the Gulf region is already causing tangible financial impacts. Insurers are reportedly preparing to cancel policies and raise prices for ships operating in the Gulf and Strait of Hormuz. This indicates that even without formal tolls, the perceived risk and increased operational costs are already affecting the shipping industry and, consequently, global supply chains and economic stability.
