Trump says U.S. will be reimbursed for Hormuz traffic

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But with armed hostilities resuming and Iran reasserting its claim over the strait, Trump is now looking for a way to reclaim leverage.

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However, any new fee threatens to raise fuel costs. A 20 per cent charge would work out to about US$32 million for a fully-loaded very large crude carrier at current oil prices. That’s far higher than the tolls that have been charged by Iran, which have previously been described as reaching US$2 million by people familiar with the situation.

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The Strait of Hormuz is a critical conduit for energy and other commodities, having provided passage for about a fifth of the world’s oil flows before the U.S. and Israel began strikes on Iran in late February. Iran’s efforts to close the waterway during the war pushed up energy prices globally and created political blowback for Trump.

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Trump celebrated the interim peace pact by touting the potential impact on gasoline prices and the economy, an acknowledgement to just how eager he is to put the conflict behind him.

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Other countries and industries reliant on traffic through the narrow waterway have insisted it should be free to access, without tolls or maritime service charges. Several U.S. officials, including Secretary of State Marco Rubio, and Trump, previously said the strait should remain open for all.

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Trump, however, telegraphed a change of heart earlier Monday, saying on Fox News that the U.S. should be compensated for helping to keep traffic moving through the strait. Other countries “made all the money” previously, he alleged. Insisting on that could anger Gulf allies that export energy through Hormuz.

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“We guarded it for nothing, and now we’re going to guard it, and we’re going to get paid for guarding it — a lot of money.” Trump said. “But we just want to be reimbursed for doing all of this, for putting our people in danger.”

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Trump has repeatedly sent conflicting signals about his plans for the strait and has in the past suggested the U.S. should receive some financial benefit from it. Earlier in the conflict, Trump floated the idea that Iran and the U.S. would both receive compensation from shippers using the strait.

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Trump’s plan would amount to a herculean task that could invite blowback from U.S. industries and allies, while potentially defying international law if not applied narrowly to escorted ships.

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Under international law, ships generally are guaranteed a right of transit passage through waterbodies used for international navigation, and coastal states aren’t allowed to charge vessels for the opportunity. There can, however, be charges for some “specific services” rendered to individual ships.

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A spokesperson for The International Maritime Organization, the United Nations’ shipping watchdog, reiterated that the body “stands firmly against charging fees for passage through straits used for international navigation.”

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In recent weeks, U.S. forces have mounted an operation to escort oil tankers and commercial ships through the strait, with air power and naval forces helping to encourage traffic on a southern route, further from Iran’s shores, even as Tehran asserted control over the waterway.

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Yet analysts have said that an even more intensive military operation involving ground troops would be necessary for the U.S. to maintain control of the strait, an action Trump has thus far been unwilling to take.

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Other Trump administration moves to insulate shipping in the strait amid the war have yet to fully materialize. In March, Trump ordered the U.S. International Development Finance Corporation to provide political risk insurance and guarantees for maritime trade through the region.

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While the DFC later announced a US$40-billion reinsurance facility with the support of private partners, it’s unclear whether it has provided any coverage yet.

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