US Imposes 20% Levy on Hormuz Ships as Tensions with Iran Escalate
The United States has announced a 20 per cent toll on all cargo ships passing through the Strait of Hormuz, a move that significantly escalates tensions with Iran over control of the strategic waterway. President Donald Trump declared on Monday that Washington was reinstating a blockade on Iranian shipping and would charge other vessels for safe passage through the strait, through which about one-fifth of global oil and gas supplies transit.
The announcement follows an Iranian attack on a container vessel in the strait on Sunday. Iran has effectively controlled the route since the outbreak of the conflict involving the United States and Israel. Under the new policy, Iranian vessels will be barred from the strait, while other ships must pay a levy equivalent to 20 per cent of the value of their cargo to cover costs of security operations.
US Central Command confirmed that military forces would resume blockading traffic to and from Iranian ports from 4 p.m. New York time on July 14. The White House did not immediately provide details on implementation or whether the plan had been discussed with Gulf allies.
Iran immediately rejected the US move. Foreign Minister Abbas Araghchi mocked Trump's announcement on social media, asserting that Iran has always been the guardian of the strait and would remain so. He suggested Iran would charge a lower fee for its own security services.
Oil prices surged on the news. Brent crude rose 7.8 per cent to $81.92 a barrel on Monday, though it remains well below the peak of nearly $120 a barrel reached earlier in the conflict. Analysts warned that a renewed blockade could provoke further Iranian attacks on vessels attempting to transit the strait.
The Strait of Hormuz is a vital chokepoint for global energy supplies. Before the conflict, it carried about 20 per cent of the world's oil and natural gas. Traffic fell sharply after Iran effectively closed the route at the start of the war, pushing up global prices of energy, fertiliser and other commodities. Although traffic improved after a recent interim peace arrangement, volumes have remained below pre-war levels.
The United States argues that it has the right to ensure freedom of navigation and to charge for security provided. Iran contends that it has authority over the strait under the interim agreement. The dispute threatens to disrupt global trade further and drive up energy costs worldwide.
Observers note that the 20 per cent levy is unusually high and would significantly increase shipping costs. At current oil prices, a 20 per cent charge on a crude oil cargo could amount to tens of thousands of dollars per vessel, potentially leading to higher consumer prices.
The announcement comes amid failed peace talks and heightened military posturing in the region. Both sides have warned against provocations, but the new US policy appears to risk direct confrontation. The international community has called for restraint and a diplomatic resolution to avoid further destabilisation of global energy markets.
