This Is America's Suez Moment, But Not the Way You Think

The idea that the United States might accept an Iranian fee regime in the Strait of Hormuz has produced something close to panic in the usual quarters.

The hysterics claim that acquiescing to a fee for passage through the strait would violate international law, make the U.S. complicit in piracy, and betray everything America has ever stood for. It’s the familiar tone of scolding and fear-mongering: once again, that reckless Trump is going to derail the world.

Yet that’s a misreading of our history. America was not founded on the doctrine that every strategic waterway must remain toll-free forever. The history of American diplomacy is one of the pursuit of our commercial interests and the defense of our liberty. It was the European imperial powers who sought to police the world, although they also did so with an eye on economic gains. And our early history is full of moments when Washington negotiated, paid, and improvised its way through charged chokepoints.

Charging a Hormuz Fee Doesn't Violate International Law

Let’s start with the objection that charging a fee would be illegal in “international waters.” The weakness here is that the shipping lanes through Hormuz run primarily through the territorial waters of Oman and partly through those of Iran. They are not the open ocean or high seas. While the orthodox law-of-the-sea position bars charges levied simply for permission to pass through an international strait, it allows fees for specific services such as policing the seaway for pirates or managing traffic.

Turkey provides a clear modern precedent. Under the Montreux Convention of 1936, merchant vessels enjoy complete freedom of transit through the Bosporus and Dardanelles. Yet Turkey routinely collects a straightforward tonnage-based fee for ships passing without stopping at its ports. These charges are framed as payment for specific services authorized by the Convention, including providing lighthouses and monitoring traffic, making sanitary and health inspections, and conducting rescue and salvage operations. Free navigation and reasonable service fees have coexisted for decades.

While some will complain that a Hormuz fee would violate the 1982 United Nations Convention on the Law of the Sea, neither the United States nor Iran has ever ratified the treaty. Iran explicitly rejected key provisions—including the strict bar on fees for passage—upon signature.