Iran has begun to formalize its control over the Strait of Hormuz, a critical global oil shipping route, by instituting a 'toll booth' regime that requires vessels to enter Iranian waters and be vetted by the Islamic Revolutionary Guards Corps (IRGC). At least two vessels have paid for passage, and traffic through the strait has dropped by 90% since the onset of the Iran war, causing global oil prices to surge and leading to significant shortages for Asian nations reliant on Persian Gulf oil shipments. Only about 150 vessels, including tankers and container ships, have transited since March 1, a figure that represents just over one day's normal traffic before the conflict began. Iran's Kharg Island terminal loaded 1.6 million barrels in March, a volume largely unchanged from prewar levels, with most customers being small, private refineries in China that are unconcerned about U.S. sanctions [1].
A majority of ships that have successfully transited the strait in recent weeks have headed east, with Iran-affiliated ships accounting for 24% of transits, Greece 18%, and China 10% by ownership or flag registration. However, vessels connected to Iran made up 60% of transits during the early stages of the war and, in recent days, 90%. Many vessels turn off their radio identification systems before entering the strait and reappear in the Gulf of Oman, likely due to security concerns. The U.N.’s International Maritime Organization reports that at least 18 ships have been attacked and at least seven crew members killed, though it did not specify which nation was responsible [1].
U.S. President Donald Trump stated that Iran allowed 10 oil tankers to transit the Strait of Hormuz as a goodwill gesture during ongoing negotiations. Trump described this as a 'present' from Iran, elaborating that Iran initially offered eight boats of oil, which ultimately became 10, and suggested they were Pakistani-flagged. The White House did not provide further details on the vessels. Trump’s comments were made as he urged Iran to agree to a deal that would clear the maritime chokepoint and end its nuclear program. He emphasized the value of the concession, calling it 'a very big present, worth a tremendous amount of money' [2].
According to Lloyd's List Intelligence, Iran’s IRGC has imposed a de facto 'toll booth' regime in the Strait of Hormuz, requiring entities to submit vessel details to 'approved intermediaries' of the Revolutionary Guard for safe passage. Approved vessels receive a code and are escorted by an IRGC vessel. The normal two-lane shipping channel is increasingly being bypassed in favor of routes through Iranian territorial waters, closer to the Iranian coastline [1].
CONCLUSION
Iran's formalization of its control over the Strait of Hormuz has significantly reduced shipping traffic and heightened global oil prices, while the U.S. acknowledges a temporary easing with the passage of 10 tankers as a negotiation gesture. The situation remains tense, with ongoing security risks and diplomatic efforts aimed at resolving the chokepoint and broader nuclear issues. Market participants should expect continued volatility in oil supply and pricing as the geopolitical dynamics evolve.