View of Belawan Port in the waters of the Straits of Malacca in Medan, North Sumatra, Indonesia, on April 28, 2026.
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Iran’s push for control of the Strait of Hormuz has some energy market participants concerned about the introduction of tolls in the Strait of Malacca, one of the world’s most important energy and trade chokepoints.
This follows reports that Iran and Oman, located on opposite sides of the Strait of Hormuz, have presented the US with a proposal to jointly manage the narrow maritime corridor, including the collection of management fees.
The United States and Iran last month agreed to a 60-day agreement to allow ships to safely and freely navigate the waterway. The Strait of Hormuz typically handles about 20% of the world’s oil shipments.
The future management and maritime operations of the strait will then be determined by Iran and Oman in consultation with other Persian Gulf states “in line with applicable international law and the sovereign rights of the Strait of Hormuz states.”
The idea of any service project passing through the Strait of Hormuz has caused alarm around the world, particularly among investors who worry that something similar could happen in other strategic maritime corridors.
However, maritime experts said they remained highly skeptical about the prospects of introducing tolls in the Strait of Malacca.
Janib Shah, vice president of commodity markets at Rystad Energy, said some investors were starting to get “a little nervous” about the possibility of an oil crisis in the form of a Strait of Malacca toll.
“I think part of the reason for that is that given the possibility of tollgates being instituted with Iran in the Strait of Hormuz, similar things could be instituted in other countries. And of course, the most important from a volume standpoint…is the Strait of Malacca,” Shah told CNBC’s “Squawk Box Europe” on Monday.
“Of course, I can’t share any more details about how that will be enacted, unfortunately, but it’s significant from a volume standpoint, so it’s probably going to take quite a while,” he added.
The Strait of Malacca, a major chokepoint between Asia and Oceania, accounted for 29% of total offshore oil flows in the first half of 2025, according to the US Energy Information Administration.
Crude oil is estimated to account for just over 70% of the total amount of oil flowing through waterways each year, with petroleum products accounting for the remainder.
Spanning approximately 900 kilometers, this waterway provides the shortest shipping route from East Asia to the Middle East and Europe. It shares borders with Indonesia, Thailand, Malaysia, and Singapore.
Strait of Malacca: Chokepoint, not flashpoint
In April, Indonesia’s Finance Minister Purbaya Yudi Sadewa suggested the country might introduce tolls on ships using the Strait of Malacca, before withdrawing the idea. Indonesia’s coastline forms the entire southern end of the Straits of Malacca.
The creation of a toll system would be illegal under international law, which guarantees the free passage of straits used for international navigation.
Indonesian President Prabowo Subianto and Singaporean Prime Minister Lawrence Wong met in the Indonesian capital on Monday, shortly after both sides reaffirmed their commitment to unimpeded passage of ships through the strait.
Hunter Marston, head of the Southeast Asia program at the Sydney-based Lowy Institute, said in a note published on June 23 that the Strait of Malacca “easily” meets the definition of a chokepoint, but not a flashpoint.
“Institutions matter,” Marston said, noting that the Malacca Strait Patrol (MSP) ensures the waterway remains open to global trade. MSP is jointly managed by four countries: Indonesia, Malaysia, Singapore and Thailand.
“This arrangement benefits all parties, not just the global economy. Without it, the Strait of Malacca would be at risk of capricious closure, just like the Strait of Hormuz,” he added.
Rerouting options
Analysts at the Center for Strategic and International Studies (CSIS), a Washington-based think tank, said Iran’s actions over the Strait of Hormuz show that seizing a maritime chokepoint could “significantly enhance” a country’s power and deterrence.
CSIS analysts said the risks in the South China Sea are “even higher,” especially given the presence of two strategically important waterways that connect many of the world’s major economic centers: the Strait of Malacca and the Taiwan Strait.
On June 21, 2026, a commercial ship is anchored off the coast of Sultan Qaboos near Qaboos Port in Muscat, Oman.
Elke Scoliers | Getty Images News | Getty Images
“Iran’s efforts to regulate and toll traffic in the Strait of Hormuz have renewed concerns that other countries may seek to do the same to the Strait of Malacca. China’s threat to use force against Taiwan also makes the Taiwan Strait the epicenter of one of the world’s most dangerous geopolitical hotspots,” CSIS analysts said in an analysis published July 1.
“If either of these two major straits are cut off, the option of rerouting exists, but it will come at a cost,” they added.
