Iran Establishes Persian Gulf Strait Authority to Control and Toll Shipping Through Strait of Hormuz
Primary region Middle East
Tags Energy · Security · Trade · Diplomacy
Regions Middle East · Asia · US
Iran has created the Persian Gulf Strait Authority (PGSA), a new government agency requiring all vessels transiting the Strait of Hormuz to submit a 40+ question 'Vessel Information Declaration' — including ownership, insurance, crew nationalities, cargo value, and intended route — and pay tolls reportedly up to $2 million per vessel. The PGSA formalizes an existing vetting process that routes ships through northern waters near the Iranian coastline. Only 40 ships crossed the strait in the week to May 3, down from a pre-war average of 120 crossings per day. The US Treasury's OFAC clarified that payments to Iran for safe passage would not be authorized for US persons or entities. India and Pakistan have negotiated with Iran to secure passage for their flagged vessels. Maritime law experts say Iran's demands violate the UN Convention on the Law of the Sea, which guarantees transit rights through international straits.
Strategic interpretation
Iran's formalization of control over the Strait of Hormuz represents an attempt to convert a wartime tactical advantage into a permanent strategic asset. The PGSA gives Iran leverage not just over the US and Israel but over all energy-importing nations, including China and India. The toll system, if enforced, could generate significant revenue for Iran's war-damaged economy. However, the practical impact remains limited as most shipowners are unwilling to comply, and the US blockade of Iranian ports continues. The outcome of ceasefire negotiations will determine whether this authority becomes a lasting feature of the regional order or a temporary wartime measure.