President Donald Trump announced Monday that the United States will impose a 20% charge on all cargo traveling through the Strait of Hormuz, positioning America as what he called the “Guardian” of the vital waterway after a ceasefire with Iran fell apart.
The breakdown stems from a dispute over Iran’s push to maintain control of the strait — a narrow, 34-kilometer (21-mile) passage that serves as the primary route for roughly one-fifth of the world’s oil supply, along with other critical goods including fertilizers. Iran shut down the strait after the U.S. and Israel attacked the country on February 28, triggering a global energy shock.
Here is a closer look at how the situation developed, how Trump’s position compares to Iran’s, and what it could mean for the rest of the world.
HAS THE U.S. CHANGED ITS POSITION ON CHARGING HORMUZ FEES?
As recently as June 25, U.S. Secretary of State Marco Rubio told Gulf states that charging for the use of international waterways was something “no country on Earth has the right” to do, and that shipping fees would never be included in any agreement with Iran.
However, Trump had already hinted at the possibility of U.S.-imposed tolls if negotiations with Iran collapsed. In a June 20 social media post, he wrote: “There will be NO TOLLS in the Hormuz Strait for 60 days during the Cease Fire Period, and there will be NO TOLLS after the 60 day period has expired, unless they are imposed by and for the United States of America, should the deal not be completed, for services rendered as the Guardian Angel to the countries of the Middle East for purposes of both past, present, and future reimbursement of costs.”
With the ceasefire now in ruins, Trump appears to have returned to that earlier position. In a social media post Monday, he stated: “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.”
Trump has offered no explanation of how such a fee would be collected or what legal authority he would rely on to enforce it.
HOW DOES TRUMP’S TOLL DIFFER FROM WHAT IRAN IS DEMANDING?
Iran’s top priority in negotiations has been securing lasting control over the Strait, whose waters it shares with Oman. Tehran views that control as its most powerful strategic tool and its best protection against future military strikes.
Iran believes the wording of last month’s interim agreement supported its position. That deal stated Iran “will make arrangements using its best efforts for the safe passage of commercial vessels with no charge for 60 days only.”
The United States, however, interpreted that language differently — viewing it as simply requiring Iran to allow safe passage without using force to restrict ships, not as granting Iran any broader authority over the waterway.
During the conflict, Tehran established what it calls the Persian Gulf Strait Authority, which it says all vessels must coordinate with before transiting the strait. Iran has also insisted ships travel only along the Iranian side of the waterway and has targeted vessels that attempted to pass near the Omani shore without its permission. Iran has suggested it may eventually charge fees for passage but has not provided specifics.
IS IT LEGAL FOR ANYONE TO CHARGE FEES FOR USING THE STRAIT?
The Strait of Hormuz runs through the territorial waters of both Iran and Oman, with the maritime boundary down the middle.
The UNCLOS maritime convention — the widely recognized framework for international sea law — states that countries bordering straits cannot charge fees simply for allowing ships to pass through. They are, however, permitted to collect limited fees for specific services such as piloting, towing, or port-related assistance, provided those charges are not applied more heavily to vessels from certain countries.
Neither Iran nor the United States has signed UNCLOS, but the convention is broadly accepted as the standard for international maritime law, and the Hormuz Strait is widely recognized as an international waterway.
A 1968 agreement between Iran and Oman, arranged through the International Maritime Organization, established traffic lanes through the middle of the Strait for large vessels. However, Iranian mine-laying during the recent conflict has rendered those lanes unsafe, according to the IMO.
WOULD THE WORLD ACCEPT THESE FEES?
Shipping industry officials say there is no modern precedent for any country unilaterally demanding payment for passage through a strait.
Oman has been in talks with Iran on the matter and issued its own guidance last month for ships transiting through its portion of the Strait — guidance that does not include any fee requirement.
Gulf states are particularly worried, as the Strait is their primary outlet to international waters for energy exports. Major importers of Gulf oil and fertilizers could also face significant consequences, especially under Trump’s proposed 20% surcharge, which analysts warn could drive global oil prices sharply higher.
