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A proposed Iran-Oman arrangement governing passage through the Strait of Hormuz would be difficult for the shipping industry to implement because of U.S. sanctions and insurance restrictions tied to transit payments, four industry sources reportedly told Reuters.
Under the latest proposal, Iran would have the authority to intervene if necessary with vessels entering the Gulf. Outbound ships would use a route between Iran and Oman and receive exit clearance through Muscat after notifying Tehran, a senior Iranian source told Reuters this week.
Iran and Oman have agreed on a route for vessels transiting the strait and are finalizing arrangements to jointly manage the waterway, Tehran said Wednesday.
The agreement would represent a step toward reopening the strategic energy route, although Iranian official sources have said any easing would still depend on Washington ending what Tehran describes as a naval blockade of Iranian ports.
Before U.S.-Israeli airstrikes on Iran on Feb. 28 triggered the war, the Strait of Hormuz was the main passage for about one-fifth of global oil supplies as well as other vital goods. Ships were able to transit freely without paying fees.
Control of the strait has since become a central issue in efforts to end the conflict.
Iran has exercised de facto control over the waterway and threatened vessels using routes it considers unauthorized since the war began.
U.S. President Donald Trump has repeatedly said Tehran is seeking a deal to reopen Hormuz. Iran has rejected that characterization and said it would instead negotiate arrangements with Oman, which sits across the strait.
The world’s leading shipping associations said in an open letter this week that merchant vessels must be able to navigate international waterways “safely, predictably and without unnecessary impediment” to maintain resilient supply chains, economic stability and energy security.
The letter, sent to the U.N.’s International Maritime Organization (IMO), said compulsory transit or service charges through Hormuz would amount to “a toll in all but name.”
“It would establish a precedent that could undermine the internationally recognised legal framework governing straits used for international navigation and transit passage,” the groups said.
The current two-way traffic separation system through Iranian and Omani waters was adopted in 1968 by the U.N. shipping agency with the agreement of countries in the region.
Iran is seeking fees of between 5% and 7% of the value of cargoes carried by ships using the strait, according to the senior Iranian official.
Oman has been discussing charges of about 3%, while Washington wants no fees imposed.
IMO said it could not comment on reports concerning the proposals.
In July, the agency’s governing council said countries around the strait should guarantee the “non-discriminatory and unimpeded right of transit passage of all ships” through the traffic separation scheme.
It also said transit should remain free of tolls and charges.
Any transit fee would pose significant compliance problems for shipping companies and oil traders because the U.S. has imposed sanctions on the Persian Gulf Strait Authority, which Iran established in May to operate the waterway.
The U.S. Treasury has also prohibited U.S. persons from receiving services from the Iranian government related to a “guarantee of safe passage.”
Any payment connected to the arrangement could potentially result in asset freezes, the four industry sources said. They spoke on condition of anonymity because of the sensitivity of the issue.
Another obstacle emerged in late July when the Lloyd’s Market Association introduced a clause for war-risk underwriters that terminates insurance coverage for vessels that pay a transit fee, toll or other charge to pass through the Strait of Hormuz.
Ships navigating the strait require an additional war-risk premium to cover possible damage during transit.
“Under the clause, insurers have no liability to indemnify any such payment and, where such a payment has been made, are discharged from obligations in respect of the relevant vessel,” the Lloyd’s Market Association said in July.
The association represents underwriting businesses operating in the Lloyd’s of London insurance market.
One insurance industry source described the situation facing shipping companies as a “catch-22” because the insurance language prevents underwriters from covering shipowners that pay a charge while Iran is seeking to impose such fees.
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