Iran requires insurance on ships using Strait of Hormuz, fees likely to follow

Iran imposes mandatory insurance on ships transiting Strait of Hormuz, with fees likely to follow - Iran’s Persian Gulf Strait Authority is imposing mandatory, Iran‑approved insurance for all ships using the Strait of Hormuz — free for 60 days, but with fees likely afterward - The move challenges a US-Iran agreement guaranteeing toll‑free passage - Iran demands vessels use its preferred northern route, with threats of penalties for non‑compliance - Shipowners, MEG states and IMO warn the policy could destabilise transit norms, while US officials emphasise keeping the strait open as negotiations continue on a long‑term framework Iran has asserted its control over the Strait of Hormuz, insisting that vessels comply with new terms and conditions to transit, including mandatory Iranian insurance for all vessels IRAN has introduced mandatory insurance for all vessels transiting the Strait of Hormuz, requiring shipowners to obtain coverage approved — and initially provided free — by Tehran’s newly created Persian Gulf Strait Authority. The move, detailed in a PGSA terms‑and‑conditions document seen by Lloyd’s List, effectively sidesteps a new US-Iran Memorandum of Understanding that guarantees “safe passage of commercial vessels with no charge” for 60 days. Iran’s insurance requirement carries no fee during that period, but Tehran has confirmed that charges may be imposed once the 60‑day window closes. “This insurance is provided free of charge to the vessel owner, with all expenses covered by the Islamic Republic of Iran,” the document states. “The PGSA reserves the right to introduce insurance fees in the future… Owners will then be required to purchase and renew coverage accordingly.” The terms, circulated across the industry on Friday and submitted to the International Maritime Organization, mark Iran’s clearest attempt yet to assert control over transit conditions in one of the world’s most critical chokepoints. Despite a growing number of vessels now using a US‑protected southern corridor near the Oman coast, Iran insists that “passage is permitted only via the designated route near Larak Island”, referring to its preferred northern channel. Enforce penalties for non‑compliance “Any deviation… is strictly prohibited and will be treated as a violation,” the PGSA warns. The authority says it is now the sole body responsible for processing transit applications and issuing permits, adding that it may “enforce penalties, revoke passage permissions, or take further legal action” for non‑compliance. Lloyd’s List has requested comment from the PGSA. Initial responses from several tanker owners using the southern route suggest that few believe the Iranian terms will provide a sustainable framework for vessels transits. “It’s madness. This whole situation is a mess,” said one major tanker owner with ships currently exiting the strait. The US-Iran MOU, signed Wednesday, guarantees toll‑free passage for 60 days and outlines a plan for Iran and Oman — in consultation with other Middle East Gulf states — to negotiate a longer‑term framework for administering the strait. Shipping companies, MEG allies, and oil majors have repeatedly warned that any transit fees in the Strait of Hormuz are unacceptable. IMO secretary‑general Arsenio Dominguez, who is working with Iran and Oman on a mechanism consistent with international law, has cautioned that allowing such charges would set a dangerous precedent for other strategic waterways. He confirmed receipt of the PGSA document and said discussions are ongoing. US President Donald Trump said Tuesday that Hormuz “will be toll free during the first 60 days and thereafter”. Asked Thursday whether Washington would intervene to prevent future fees, vice-president JD Vance reiterated that the US believes “international waterways should be free of tolls”, but stressed that keeping the strait open is the overriding priority. “The MOU contemplates that the Omanis, the Iranians, and the Gulf coast coalition together will figure out a proper security framework for the straits in the future,” Vance said, adding that the goal is to ensure the waterway is never again used as a chokepoint for the global economy.