Iran has secretly established a de facto safe shipping corridor north of Larak Island, as it seeks to monetize control of the world’s most important oil shipping artery, while blocking much of the traffic through the Strait of Hormuz. Traffic through the strait has fallen by 90% since the war began on February 28, and Iran has targeted ships attempting to pass through the waterway, causing one of the world’s most devastating energy supply shocks in decades. Some ships are passing through Iranian territorial waters near Larak Island, off the coast of the Iranian port city of Bandar Abbas, with the Iranian Revolutionary Guards Corps (IRGC) and port authorities inspecting each vessel before allowing passage. Lloyd’s List Intelligence, a maritime research firm, said, “Iran’s Revolutionary Guards have introduced a de facto ‘toll plaza’ system in the Strait of Hormuz.” Nearly all recorded crossings in the past three weeks have bypassed the narrow strait north of Raraku Island, close to Iran’s coastline, signaling a “permit-based, selectively accessible corridor,” according to shipping information firm Windward. Lloyds said all 57 recorded crossings since March 13 took the Larlac detour, with very few taking the normal route. Windward said ships were also observed queuing up north of Lalac Island waiting for permits, and several ships had been turned back in recent days. Iran takes great care to ensure that only certain vessels are allowed through, giving priority to countries with friendly relations and those with ties to its own trade. Brigitte Diakun, Senior Risk Compliance Analyst, Lloyd’s List Intelligence Iran’s parliament passed a bill on Tuesday formalizing the collection of tolls on ships passing through the strait. This is a measure to institutionalize Iran’s financial control over this difficult area. The bill would require the consent of other countries bordering the strait and would impose fees on ships, energy transport and food supplies passing through the waterway. At least two ships that passed through the strait paid fees to Iranian authorities, and the payments were settled in Chinese yuan, Lloyds said. Lloyd’s said one case was “mediated by a Chinese maritime services company, which also made payments to Iranian authorities,” but the amount and method of payment was not disclosed. “Iran is taking great care to ensure that only certain vessels are allowed through, prioritizing those with friendly relations and those with trade links to the country,” said Bridget Diakun, senior risk compliance analyst at Lloyd’s List Intelligence. As the conflict escalates into its fifth week, the U.S. and Iranian governments have given conflicting messages about whether they are seriously negotiating to end the war. President Trump appeared to be declaring victory, saying in the United States on Tuesday night that he expected American troops to be withdrawn from Iran within “two to three weeks.” Iranian Foreign Minister Abbas Araghchi acknowledged that messages had been exchanged with the United States, but they did not constitute “negotiations.” How the “toll” system works According to Lloyd’s List Intelligence, ship operators first approach an intermediary associated with the IRGC and provide detailed documentation, including the ship’s International Maritime Organization number, crew names and final destination. The IRGC will review the information and, if approved, issue a clearance code and routing instructions. When a ship enters Iranian territorial waters, the commander of the Revolutionary Guards summons it over a maritime radio channel and requests a clearance code. If approved, Iranian boats will escort the ship through territorial waters around Raraku Island. Vessels that fail the inspection will be rejected. Who obtains information and how? Determining the ownership of a ship is complicated because there are multiple layers to ship registration, such as flag state and registered owner, and opacity increases depending on factors such as the nationality of the crew and the final destination. However, most of the recorded passages were vessels associated with Iran, Greece and China, with a small number of vessels associated with Pakistan and India also passing through, Diakun said. Several governments, including India, Pakistan, Iraq, Malaysia and China, are reportedly in direct talks with Tehran to coordinate transit through the Revolutionary Guards screening system. Two super-large container ships associated with Chinese state-owned Cosco Shipping completed the Larak route earlier this week after being initially refused. It was the first confirmed transit by a major Chinese container ship since the war began, according to commodity information provider Kpler. A Chinese Foreign Ministry spokesperson confirmed on Tuesday that three Chinese ships had recently passed through the Strait of Hormuz, adding that the passage was carried out with “facilitation and coordination of all concerned parties”. “The Strait of Hormuz is an important route for international trade in goods and energy. China calls for an early ceasefire and a peaceful and stable Persian Gulf,” the spokesperson added. India ensured the safe passage of the Indian tanker without payment or prior permission, local media reported, citing government officials. New Delhi welcomed direct dialogue with Iran as the most effective way to restart shipping through the Strait of Hormuz. The Indian-flagged LPG tanker Pine Gas, which passed through the corridor last month, received instructions from the Revolutionary Guard commander to reroute to the Larak Strait, and was escorted by an Indian warship during the passage, Reuters reported, citing Pine Gas chief executive Sohan Lal. Lal said the company had not paid the transit fee. Southeast Asian countries bearing the brunt of the fuel supply shock, such as Malaysia and Thailand, also reportedly received assurances from Iran about the safe passage of their ships following diplomatic intervention with Iran. Does Iran have the right to charge tolls? Iran’s claim to control over internationally recognized shipping lanes violates the United Nations Convention on the Law of the Sea and is unlikely to receive support from neighboring countries, experts told CNBC. Shahra Ali, a law professor at the University of Hong Kong, said that under international law, Iran has no legal authority to impose a flat toll on ships passing through the Strait of Hormuz. “States may charge reasonable, non-discriminatory fees for certain services they actually provide within their territorial waters, such as pilotage or pollution response, but these fees must be tied to the services actually provided,” Ali said. “Unilateral parliamentary action imposing extensive transit fees would therefore violate established international maritime law and would likely face strong diplomatic and legal challenges.” Comparing the Strait of Hormuz to the Suez or Panama Canals is meaningless. Both Suez and Panama, which charge shipping tolls for passage, are not naturally formed, but are built, maintained and operated by sovereign states, and the legal distinction gives operators the right to collect tolls to cover the cost of construction, maintenance and operation. The European Parliament Research Service says the Panama Canal Authority charges fees based on the size and type of vessels using the waterway, and that the fees are uniform, fair and non-discriminatory.
