‘Guardian of the Strait’: President Trump says US will charge 20% fee for ships using Strait of Hormuz
President Donald Trump says the United States will begin charging ships for safe passage through the Strait of Hormuz, proposing a fee equal to 20% of the value of the cargo they carry.Trump said the money would reimburse the United States for the cost of providing security in the critical waterway, where roughly a fifth of the world’s oil and natural gas traveled before the war disrupted shipping.“The U.S.A. will be, from this point forward, known as ‘THE GUARDIAN OF THE HORMUZ STRAIT,’ but as such, and as a matter of FAIRNESS, will be reimbursed, at the rate of 20% on all cargo shipped, for any and all costs necessary to do the job of providing safety and security to this very volatile section of the World,” President Trump said.The White House has not explained which cargo would be subject to the charge, whether shipping companies, cargo owners or foreign governments would be responsible for paying it, or how the United States would determine the value of each shipment.U.S. Central Command said it will resume blocking vessels traveling to or from Iranian ports beginning Tuesday afternoon and warned that force could be used against ships that do not comply. However, a CENTCOM spokesperson would not say whether the military would also collect the fee and referred questions to the White House.The proposal represents a sharp reversal from the administration’s position just weeks ago. Secretary of State Marco Rubio said in June that the Strait of Hormuz is an international waterway and that countries cannot charge ships simply to pass through it.”No country is allowed to charge tolls or fees on an international waterway. That’s existing international law. That’s the way it is in international waterways all over the world and that’s the way we’ll expect it’ll be here,” Rubio said at the time, while opposing an Iranian proposal to impose fees.Iranian Foreign Minister Abbas Araghchi used the president’s announcement to support Iran’s own claim that it should be compensated for securing the waterway. Araghchi said whoever provides safe passage should be paid, but called Trump’s proposed 20% charge too high and insisted Iran would remain the strait’s guardian.The dispute could further increase the cost of moving oil, natural gas and other goods through the region. Brent crude, the international oil benchmark, rose sharply Monday to over $81 per barrel as renewed U.S. and Iranian attacks raised fears of a wider disruption.Shipping through the strait had begun to recover following an interim agreement between Washington and Tehran, but traffic remains well below prewar levels. That agreement called for the waterway to reopen and led the United States to suspend an earlier blockade of Iranian ports.
President Donald Trump says the United States will begin charging ships for safe passage through the Strait of Hormuz, proposing a fee equal to 20% of the value of the cargo they carry.
Trump said the money would reimburse the United States for the cost of providing security in the critical waterway, where roughly a fifth of the world’s oil and natural gas traveled before the war disrupted shipping.
“The U.S.A. will be, from this point forward, known as ‘THE GUARDIAN OF THE HORMUZ STRAIT,’ but as such, and as a matter of FAIRNESS, will be reimbursed, at the rate of 20% on all cargo shipped, for any and all costs necessary to do the job of providing safety and security to this very volatile section of the World,” President Trump said.
The White House has not explained which cargo would be subject to the charge, whether shipping companies, cargo owners or foreign governments would be responsible for paying it, or how the United States would determine the value of each shipment.
U.S. Central Command said it will resume blocking vessels traveling to or from Iranian ports beginning Tuesday afternoon and warned that force could be used against ships that do not comply. However, a CENTCOM spokesperson would not say whether the military would also collect the fee and referred questions to the White House.
The proposal represents a sharp reversal from the administration’s position just weeks ago. Secretary of State Marco Rubio said in June that the Strait of Hormuz is an international waterway and that countries cannot charge ships simply to pass through it.
“No country is allowed to charge tolls or fees on an international waterway. That’s existing international law. That’s the way it is in international waterways all over the world and that’s the way we’ll expect it’ll be here,” Rubio said at the time, while opposing an Iranian proposal to impose fees.
Iranian Foreign Minister Abbas Araghchi used the president’s announcement to support Iran’s own claim that it should be compensated for securing the waterway. Araghchi said whoever provides safe passage should be paid, but called Trump’s proposed 20% charge too high and insisted Iran would remain the strait’s guardian.
The dispute could further increase the cost of moving oil, natural gas and other goods through the region. Brent crude, the international oil benchmark, rose sharply Monday to over $81 per barrel as renewed U.S. and Iranian attacks raised fears of a wider disruption.
Shipping through the strait had begun to recover following an interim agreement between Washington and Tehran, but traffic remains well below prewar levels. That agreement called for the waterway to reopen and led the United States to suspend an earlier blockade of Iranian ports.