The main channel of Hormuz is blocked, and ships are detouring to Iran's Larak Island in batches for

# Xu Chao

Source: Wallstreetcn

According to CCTV, Iran’s parliament has passed a bill to impose tolls on vessels passing through the Strait of Hormuz, with ships from the United States, Israel and sanction-imposing countries to be banned directly. Meanwhile, oil tankers have been diverting in large numbers to **Larak Island** of Iran to “pay for passage”. The lifeline of millions of barrels of crude oil per day worldwide is facing a triple shock from costs, compliance and supply chain risks.

As the main shipping lane of the Strait of Hormuz—the world’s most important oil transit route—remains blocked, oil tankers have been diverting in bulk to Larak Island under Iranian control to seek safe passage. At the same time, Iran’s parliament is accelerating legislation to provide institutional backing for this “toll arrangement”.

According to CCTV News, on March 31, the National Security and Foreign Policy Committee of Iran’s parliament approved a bill to levy tolls on vessels traversing the Strait of Hormuz. It plans to establish a financial framework and tolling system denominated in Iran’s national currency, the rial, and explicitly bans passage for ships from the U.S., Israel, and countries that have imposed unilateral sanctions on Iran.

Separately, CNBC reported that oil tankers have already begun rerouting near Larak Island to secure safe passage, effectively creating a de facto “toll booth”.

These developments directly disrupt the global energy supply chain. The toll mechanism will raise logistics costs for crude oil and liquefied natural gas shipped through the waterway. The ban on vessels from sanctioning countries will further force European and American shipping companies to weigh compliance constraints against routing efficiency, exacerbating uncertainty in energy supply.

## Parliament Legislation: Institutionalizing the Toll System

As reported by CCTV News on March 31, the National Security and Foreign Policy Committee of Iran’s Majlis (parliament) has approved a bill to impose transit fees on ships passing through the Strait of Hormuz.

The bill specifies that tolls will be collected in Iran’s national currency, the rial, with detailed financial arrangements and the fee structure yet to be finalized.

On access restrictions, the bill sets layered prohibitions:

- Ships from the United States and Israel are explicitly denied passage;

- Vessels from countries that have imposed unilateral sanctions on Iran are also blacklisted.

The bill also affirms Iran’s and its armed forces’ dominant control over the Strait of Hormuz.

For enforcement, Iran will cooperate with Oman to develop a joint legal framework, seeking multilateral support for the toll system.

## Diversion to Larak Island: “Paying for Safe Passage”

According to CNBC, amid instability on the main shipping lane, oil tankers have begun rerouting en masse to waters near Iran’s Larak Island in exchange for safe passage.

Larak Island lies in Iranian-controlled waters near the Strait of Hormuz. Its strategic location allows Iran to exercise de facto control over vessels taking the detour.

This rerouting pattern shows that some shipping companies have already accepted Iran’s access terms in practice.

As the legislative process advances, this “pay-to-pass” system is evolving from an informal practice into an institutional rule.

## Market Impact: A Triple Overlay of Cost, Compliance and Supply Chain Risks

The Strait of Hormuz is the world’s most critical crude oil export corridor, carrying massive volumes of crude and LNG to major global markets daily. Formal implementation of the toll regime would affect energy markets on multiple fronts:

- **Higher logistics costs**

Transit fees will directly increase the all-in cost of crude shipped via this route, with potential pass-through to downstream end-user energy prices.

- **Compliance dilemmas for Western shippers**

The ban on vessels from sanctioning countries will create binding restrictions on many Western shipping firms. Companies will face difficult tradeoffs between adhering to sanctions rules and maintaining route efficiency, generating extra compliance and operational costs.

- **Increased supply chain uncertainty**

Blocked main lanes combined with unclear regulatory timelines will amplify volatility risks in energy supply, creating potential upward pressure on crude prices.

The bill remains in the legislative pipeline. Whether it will complete all procedures and enter into force remains to be seen.

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