Strait of Hormuz Transit Fees in Ceasefire Talks and Global Oil Trade Impacts

A two-week ceasefire agreed by the United States and Iran includes a plan affecting the Strait of Hormuz. Reports said Iran and Oman may be allowed to levy transit fees. The route carries nearly one-fifth of global oil trade. The plan followed weeks of disrupted shipping and sharper price moves in oil markets.

The ceasefire was reached early Wednesday and aimed to end a 40-day conflict. The fighting began on February 28. Attacks on vessels disrupted the waterway during the hostilities. Oil prices jumped as risks grew. Under the understanding, Tehran conditionally agreed to reopen the shipping corridor for traffic.

Reports said the transit fee could be flexible and depend on several factors. These included vessel type, cargo, and operating conditions. Iran’s Deputy Foreign Minister Kazem Gharibabadi said Iran was working with Oman. The two sides were drafting a framework. The stated aim was smoother maritime movement, not restrictions.

The Strait of Hormuz is a narrow passage in West Asia. It links the Persian Gulf to the Gulf of Oman. It then opens into the Arabian Sea. Iran lies to the north and Oman to the south. Oman’s Musandam Peninsula sits on the strait. It is separated from Oman’s mainland.

At its narrowest point, the strait is about 34 kilometres wide. Shipping lanes are far narrower than the full width. Vessels use separate channels for inbound and outbound traffic. The strait is the only sea outlet from the Persian Gulf. Saudi Arabia, Iraq, Kuwait, and the United Arab Emirates rely on it.

It has long been treated as an international waterway and remained toll-free. Shipping has moved without transit charges. Any change could alter costs for oil and gas exports. It could also affect insurance and freight rates. Traders track the corridor because it handles a large share of seaborne crude.

Strait of Hormuz transit fees and international law under UNCLOS

The legal position is not straightforward under UNCLOS rules. States bordering international straits cannot charge only for passage. Limited fees may apply for defined services. These include pilotage, towing, or port-related assistance. Charges must be uniform and non-discriminatory. Any formal structure would need to align with these limits.

Item	Detail
Narrowest width	About 34 kilometres
Bordering sides	Iran (north), Oman including Musandam Peninsula (south)
Key role	Only sea passage from the Persian Gulf to open ocean
Oil trade share	Nearly one-fifth of global oil trade

Several Gulf countries opposed the fee idea, according to reports. The United Arab Emirates and Qatar supported open navigation without charges. They also suggested delaying any financial discussions. They said talks should wait for wider agreements. The pushback added uncertainty over whether the plan can gain regional acceptance.

US President Donald Trump said Iran shared a 10-point proposal. Trump called it a "workable basis" for negotiations. Trump said an agreement could be finished within the two-week ceasefire window. No further points were released. Separate talks involving the US and Israel were set for Friday in Islamabad.

The ceasefire reduced immediate pressure on shipping through the Strait of Hormuz. Yet the transit fees proposal raised questions for trade costs and legal compliance. Iran’s conditional reopening and Oman’s involvement remained central to the plan. With opposition from some Gulf states, the next rounds of talks were expected to shape outcomes.