Oman Says Strait of Hormuz Unlikely To Return To Pre-War Status, Signals Possible Transit Fees for Ships

The possibility of transit fees has raised concerns among the United States, European countries and Gulf Arab states because the Strait of Hormuz is a key route for global oil and liquefied natural gas (LNG) shipments. Any new charges on vessels could add billions of dollars in annual costs for shipping companies and commodity traders and have become a key issue in ongoing US-Iran peace talks.      According to a Bloomberg report, Omani officials said the country would continue to follow international maritime law but suggested that ships could be charged for services such as pollution control or navigational assistance in the strait. It is still unclear whether these charges would be mandatory.   The officials also said Oman is studying how other major maritime chokepoints operate, including the Strait of Malacca in Asia, where ships do not pay mandatory transit fees.

The possibility of Oman and Iran introducing a joint fee system for ships using the Strait of Hormuz has increased concerns among Western governments and Gulf States.   French President Emmanuel Macron is scheduled to meet Oman’s Sultan Haitham bin Tariq in Paris on Monday, where the security of maritime routes and the need for free passage through the Strait of Hormuz are expected to be discussed. According to Macron’s office, the two leaders will discuss “the security of maritime routes, which depends on free and unconditional passage through the Strait of Hormuz…A senior US official, speaking on condition of anonymity because the discussions were private, said Iran had informed the Trump administration that it was not seeking or collecting tolls, insurance costs or any other charges from ships passing through the strait.The official added that US President Donald Trump has repeatedly said Iran cannot impose tolls on the waterway.   The Strait of Hormuz, shared by Oman and Iran, is one of the world’s most important shipping routes for crude oil and liquefied natural gas exports.       Iran disrupted shipping in the strait by attacking and threatening vessels from late February after the United States and Israel launched military strikes against the country. Western governments have also said Iran likely laid mines in parts of the waterway during the conflict.      With Washington and Tehran now holding peace talks, Iran has said it wants to jointly manage shipping traffic in the Strait of Hormuz with Oman.      Oman has, however, sent mixed signals about the future of the waterway.   Earlier this week, Oman and Iran issued a joint statement saying they would discuss how the Strait of Hormuz would be managed and the costs associated with it.   Two days later, Oman joined the United States and the Gulf Cooperation Council in signing a statement rejecting “any tolls, fees, or attempts to assert control over the Strait.”   “They said in the meeting and they signed on to the statement that there aren’t going to be any fees or tolls, and so I think that’s good news,” US Secretary of State Marco Rubio said during a visit to Bahrain.   According to Bloomberg, Omani officials have privately told European counterparts that they are under pressure from Iran.   Although Oman is a close US ally, it also has strong ties with Iran and has often acted as a mediator between Washington and Tehran. It is sometimes called the “Switzerland of the Middle East” because of its neutral role in regional conflicts. During the conflict, Iran launched missiles and drones across the Middle East, including at Oman. Despite damage caused by US-Israeli airstrikes, Iran remains a major military power in the Persian Gulf.   “Oman is caught between a rock and a hard place trying to maintain a balancing act between Iran and the US,” Bader Al-Saif, assistant professor at Kuwait University and associate fellow at Chatham House, told Bloomberg.   “Doing so has more or less worked in the past. But with the two sides at war and constantly trying to outmaneuver one another, this Omani behavior will bite them eventually,” he said.      Iran has also said that ships passing through the Strait of Hormuz will need to obtain insurance through Tehran, adding that the coverage will remain free for about 60 days.   The issue of transit fees has become one of the key points in talks between the United States and Iran over a permanent peace agreement following nearly four months of conflict.   Rubio said on Thursday(25 June) that Iran would have to keep the Strait of Hormuz free of tolls and ensure ships are not charged transit fees if it wants to secure a formal peace deal. Otherwise, he warned, other countries could begin introducing similar charges at major maritime chokepoints around the world, creating disruption to global shipping.      According to the report, any fees imposed on ships using the Strait of Hormuz could cost shipping companies and commodity traders tens of billions of dollars every year.     Governments including the United States, the United Kingdom, France, Saudi Arabia and the United Arab Emirates have warned that such charges would violate international maritime law.