FINWIRES · TerminalLIVE
FINWIRES

Global Shipping Giants Urge UN, IMO to Block Strait of Hormuz Tolls

By

Eight major international shipping associations have petitioned the United Nations and International Maritime Organization to reject any compulsory transit tolls or service fees in the Strait of Hormuz, warning that charging for passage would breach international law and destabilize global energy markets.

Leading maritime associations including the International Chamber of Shipping, Bimco, Intertanko, the World Shipping Council and others submitted a joint open letter on Aug. 3 to UN Secretary General Antonio Guterres and IMO Secretary General Arsenio Dominguez, made public on Wednesday.

The coalition strongly rebuffed the potential imposition of compulsory transit charges, service fees, or disguised tolls for merchant vessels navigating the critical Strait of Hormuz.

According to the signatories, introducing mandatory fees breaks decades of established international practice and violates core principles enshrined in the United Nations Convention on the Law of the Sea.

Beyond direct financial burdens on shipowners, the groups cautioned that any added transport costs would inevitably cascade down international supply chains, driving up global energy prices, stoking inflation, and escalating economic uncertainty worldwide.

Meanwhile, diplomatic efforts over the normalization of the shipping in the waterway continues.

Iran's Foreign Ministry spokesperson Esmaeil Baqaei said Iran and Oman are nearing a final understanding on a commercial shipping route through the Strait of Hormuz, according to the Ministry of Foreign Affairs' Telegram post on Wednesday.

Reuters reported, citing officials familiar with the matter, that the proposed framework would grant Tehran control over inbound ships entering the Gulf through the strait.

SEB analysts noted, "Iran has stated that it has reached an agreement with Oman on a shipping route through the Strait of Hormuz, but the US has not yet made any official comments on the proposal."

Shipowners worry that allowing fees in Hormuz would set a dangerous global precedent, encouraging similar financial bottlenecks in other critical global waterways like the Strait of Malacca and Bab el-Mandeb.

Related Articles

Oil & Energy

US Oil Update: Crude Mixed as Inventory Build, Hormuz Optimism Offset Houthi Attack

Crude futures diverged in after-hours trading on Wednesday, pressured by a build in crude inventories and renewed optimism over potential diplomatic progress to reopen the Strait of Hormuz, even as a fresh Houthi attack on a Saudi oil tanker in the Red Sea offered some support.Front-month West Texas Intermediate crude futures retreated by 0.9% to $75.08 per barrel, while Brent futures were up 0.2% to $79.53/bbl.Saxo Bank strategists said that WTI slipped toward $74.50/bbl, taking the two-session decline past 10%, its steepest such drop in weeks.US commercial crude oil inventories increased by 2.5 million barrels to 407 mmbbls in the week ended July 31, the Energy Information Administration said in its weekly report on Wednesday. Crude inventories were about 6% below the five-year average for this time of year, the EIA said.The increase is in line with Macquarie's estimate of a 2.5-mmbbl build for the week ended July 31.The EIA said that US fuel prices edged lower in early August as crude oil prices declined from late July levels, while gasoline and diesel prices remained elevated compared with a year earlier.WTI crude oil at Cushing, Oklahoma, settled at $86.16/bbl for the week ending July 31, dropping from $91.74 a week earlier, though remaining well above the $68.39 level recorded during the same period last year.Meanwhile, Iran's Foreign Ministry spokesman, Esmaeil Baghaei, said Iran and Oman had reached an understanding on the geographic coordinates for a shipping route through Hormuz, and a joint announcement is being finalized.Baqaei said talks between Iran and Oman had been underway for the past two months to establish a safe passage mechanism for commercial vessels transiting the strategic waterway.President Trump said on Tuesday that an agreement to reopen and ensure maritime security on the Hormuz is imminent, as he hailed "very good discussions" with Iran.US Central Command also said the "southern route of the Strait of Hormuz remains free and open" in a post on X, highlighting that it had assisted over 1,000 vessels in transiting the waterway despite "unwarranted" Iranian aggression.ING strategists said if a deal holds and we see oil flows from the Persian Gulf normalize, market attention will quickly turn to the supply and demand balance in the fourth quarter and 2027.Shoring up prices, Yemen's Houthis attacked a Saudi oil tanker in the northern Red Sea off the coast of Yanbu on Wednesday, a day after the Gulf state diverted ships away from the Bab el-Mandeb chokepoint to the south of the waterway.Houthi spokesperson Yahya Saree said that the latest attack brings the total number of targeted Saudi oil tankers to eight since the start of the group's maritime blockade on July 22.Saree said the group intends to target Saudi tankers in the northern Red Sea to "close all access points and prevent their passage" as it vows to "continue and escalate" its operations.

Oil & Energy

Occidental Beats Q2 Production Guidance, Raises Full-Year Outlook

Occidental (OXY) released Q2 earnings Wednesday, reporting global production of 1.433 million barrels of oil equivalent per day, exceeding the high end of its guidance.Occidental said its Gulf of Mexico and Permian business units outperformed in the quarter.Gulf of Mexico total production averaged about 144,000 boe/d. Of this, oil accounted for 121,000 b/d, while natural gas liquids stood at 11,000 b/d and natural gas stood at 74 million cubic feet per day.Permian Basin total production averaged 804,000 boe/d. Of this, oil accounted for 407,000 b/d, while natural gas liquids stood at 213,000 b/d and natural gas stood at 1.106 billion cubic feet per day.The Permian Basin reported a 25% increase in average wells per pad.Occidental spent about $1.6 billion of net capex in the Permian Basin in H1 2026, running 20 gross rigs, 15 on a net basis, to bring 256 wells online, and expects full-year Permian capex of roughly $3.1 billion, with 19 gross rigs, 14 net, delivering 485-515 wells online.In the Rockies, the company spent about $0.4 billion in H1 2026 across three gross rigs, two net, for 84 wells online, and projects full-year Rockies capex near $0.8 billion, with three gross rigs, three net, bringing 150-170 wells online across the DJ and Powder River basins.Occidental raised its full-year 2026 average production guidance by about 3,000 boe/d to a range of 1.423 million boe/d to 1.453 million boe/d, after Q2 production beat guidance by 23,000 boe/d.Production strength in the Gulf of Mexico and Permian output, partly offset by Middle East disruptions, prompted this revision, Occidental said. The company guided Q3 average production of 1.40 million boe/d to 1.44 million boe/d.

$OXY
Oil & Energy

Middle East Traffic Patterns Diverge as Shipping Security Risks Stay Elevated

Security risks in key Middle Eastern chokepoints remain elevated, shaped by diverging traffic trends in the Strait of Hormuz and Bab el-Mandeb, fresh confirmed vessel attacks, and military deployments.The latest data from MarineTraffic showed 42 confirmed vessel crossings through the Hormuz and the Bab el-Mandeb on Aug. 4."Strait of Hormuz crossings fell to 8 on 4 August, down 20% day on day from 10," according to MarineTraffic's update on Wednesday.Most of the vessels exited the Middle East Gulf and routing concentrated around the Iranian Unilateral Scheme, which accounted for five of the total eight crossings. The remaining three transits were "Route Undetermined," with no Hormuz Traffic Separator Scheme crossings reported.MarineTraffic said that its latest daily dataset for Aug. 4 showed five "All Rest" vessels and three shadow fleet vessels, with no sanctioned crossings recorded.Bab el-Mandeb crossings, in contrast, rose to 34 on Aug. 4, from 25 recorded the previous day. However, dark transit activity was up in the Aug. 4 dataset."Directionally, the latest flow was slightly weighted toward vessels entering the Red Sea, with 18 entries and 16 exits," according to MarineTraffic.The International Maritime Organization's daily Strait of Hormuz incident tracker recorded an additional confirmed attack off the Omani coast on Aug. 3. These incidents bring the total number of confirmed maritime security incidents in the region to 64 as of Aug. 4.The IMO tracker provides a daily log of verified strikes on ships attempting to transit the Strait of Hormuz since the conflict began, with the earliest incident recorded on March 1.The outlook deteriorated further following the confirmed attack, adding to growing concerns over commercial shipping in the Strait of Hormuz.The US Central Command said US forces had assisted over 1,000 vessels in safely transiting the Hormuz over the past three months despite what it described as "unwarranted Iranian aggression."Centcom said in an X post on Wednesday that it had redirected 48 commercial vessels, disabled two vessels and boarded two others as of Aug. 5, as part of efforts to safeguard freedom of navigation through the strategic waterway.Meanwhile, the UK Maritime Trade Operations issued two new incident reports involving vessels off the Yemeni coast.UKMTO said a vessel about 9 nautical miles southwest of Al Mukha was attacked by an uncrewed surface vessel, causing a fire on board. Separately, the master of a tanker reported hearing a loud explosion close to the vessel about 95 nautical miles southeast of Aden.The incidents came as Yemen's Houthis claimed responsibility for another attack on Saudi shipping, saying the group had struck a Saudi-flagged oil tanker in the northern Red Sea off Yanbu.Houthi spokesperson Yahya Saree said the movement had targeted a total of eight Saudi oil tankers since announcing the blockade on July 22 and had forced 29 Saudi tankers to turn back in the Red and Arabian Seas.Saree said the group intends to expand operations into the northern Red Sea after claiming success in tightening its blockade around Bab el-Mandeb.The Iran-aligned militant group plans to expand operations into the northern Red Sea after alleging that Saudi tankers had begun rerouting away from the Bab el-Mandeb Strait.