17MAY

Azizi names Hormuz toll regime on X

4 min read

10:45UTC

Ebrahim Azizi, who chairs Iran's parliamentary security committee, posted on Saturday that Iran has a 'professional mechanism' for Hormuz traffic with fees on cooperating vessels and Project Freedom barred from the route.

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Key takeaway

Iran's parliament endorsed a Hormuz toll mechanism contradicting the UNCLOS Article 38 transit-passage framework.

Ebrahim Azizi, chairman of Iran's Majlis National Security and Foreign Policy Committee, posted on X on Saturday 16 May that Tehran has "prepared a professional mechanism" to manage Strait of Hormuz traffic along a designated route, with "necessary fees" collected from cooperating vessels and operators of "the so-called freedom project" expressly barred. The chairman attached no fee schedule, no unveiling date and no parliamentary vote ¹. The Majlis is Iran's 290-seat Parliament; its National Security Committee is the legislative branch's apex voice on military and Foreign Policy, and Azizi has chaired it since 2024.

The political claim arrives on top of operational machinery that has been live since early May. The Persian Gulf Strait Authority (PGSA) opened registration at info@pgsa.ir on 6 May and Lloyd's List documented vessels paying up to $2 million per voyage in Chinese yuan , . The Iranian Supreme National Security Council finalised the underlying Hormuz security plan and barred US weapons from transit on 13 May , so Azizi's post extends an already-running architecture into a published political claim with a named exclusion class.

That exclusion class is the legal flashpoint. Project Freedom, the US operational umbrella Donald Trump announced on Truth Social before pausing in early May, is precisely the kind of military mission Article 38 of the 1982 UN Convention on the Law of the Sea treats as guaranteed transit passage for all flags. By naming a sovereign exclusion list in writing, Azizi puts the Majlis directly across from the 26-nation Hormuz coalition signed in Bahrain and Qatar on 12 May , whose mandate is built on that same Article 38 guarantee. Four separate Iranian institutions, the SNSC, the IRGC, the PGSA and now the Majlis security committee, are converging on a single Hormuz posture: selective accommodation policed by guided coordination through declared minefields.

Deep Analysis

In plain English

Iran's parliament has a committee that oversees national security. Its chairman, Ebrahim Azizi, posted on social media on 16 May that Iran has set up a formal system to charge ships a fee to pass through the Strait of Hormuz, a narrow waterway where roughly 20% of the world's oil travels. Ships linked to a US military operation called Project Freedom are explicitly banned from using the route. This is the first time Iran's parliament has formally backed what the country's military has been doing operationally since early May: collecting fees from ships that want to pass. The legal problem is that a 1982 international treaty guarantees all ships the right to pass through straits like Hormuz without paying a toll. Iran never signed that treaty.

Deep Analysis

Root Causes

Iran never ratified the 1982 UN Convention on the Law of the Sea, which means UNCLOS Article 38's transit-passage guarantee has no binding force in Iranian domestic law. Tehran's 2024 update to its maritime jurisdiction statutes, carried through the Majlis security committee Azizi chairs, inserted the category 'hostile-linked vessels' into Iranian law, broad enough to cover any flag state that has sanctioned Iran or joined a named coalition against it.

The PGSA's creation on 5 May preceded the Azizi post by eleven days: the parliamentary statement follows operational fact, not the other way around. The Majlis is providing retroactive legislative authority for an architecture the IRGC deployed before parliament voted. This sequencing, operational first, legislative second, is a structural feature of how Iran's dual-track state functions under war conditions.

Escalation

The parliamentary endorsement closes the gap between operational and legislative legitimacy on the Iranian side, making the PGSA toll mechanism harder to walk back in any negotiated settlement without a specific Majlis vote to repeal it. Four Iranian institutions, SNSC, IRGC, PGSA, and now the Majlis security committee, are now all on record supporting the same Hormuz posture.

What could happen next?

Precedent
Parliamentary endorsement of a named exclusion class for a sovereign transit mechanism sets a legal template other states could reference when asserting chokepoint jurisdiction.
Medium term · Medium
Risk
The Majlis record makes the toll mechanism a legislative commitment, requiring a floor vote to reverse, which adds institutional friction to any ceasefire deal that includes Hormuz normalisation.
Short term · High
Consequence
Vessels operating under insurance from Lloyd's P&I clubs face cover withdrawal if their operators are classified as 'Project Freedom'-adjacent under the Azizi exclusion language.
Immediate · Medium

Source Landscape

This story draws on neutral-leaning sources from United States and United Kingdom

United States

United Kingdom

LeftRight

Primary parallel: Egypt's 1956 nationalisation of the Suez Canal under Nasser is the closest structural antecedent. Nasser unilaterally asserted sovereign toll authority over a recognised international waterway, citing the 1888 Constantinople Convention's transit guarantees while overriding them in practice.

The financial mechanism (transit dues replaced by nationalised revenue) and the named exclusion class (Israel was barred by Egyptian decree) parallel Iran's Azizi announcement exactly. The Suez crisis took 88 days from nationalisation to the tripartite invasion, with toll revenue flowing throughout. Iran's PGSA has been collecting yuan tolls since 6 May (ID:3042) on a comparable timeline.

Counter-parallel: The 1979 Iranian seizure of Bandar Abbas and the temporary 1980 Gulf tanker interdictions during the Iran-Iraq War never produced a stable parliamentary-backed toll mechanism. Both dissolved under military pressure within 24 months without producing a durable legal architecture. The 2026 Azizi announcement is structurally distinct because it fuses domestic legislation, an operational body (PGSA), and an explicit exclusion class inside a single parliamentary record.

The toll mechanism operates through two channels simultaneously. The yuan-denominated PGSA fee, documented at up to $2 million per VLCC voyage by Lloyd's List , runs through Chinese correspondent-banking infrastructure outside OFAC reach, making it sanction-resistant by design.

The bilateral political-engagement track, where Iraq and Pakistan bypassed the yuan fee by providing political cover instead , reveals the toll as a discriminatory admission test, not a revenue instrument.

At Brent $109.30 on 16 May , the Hormuz risk premium sits embedded in the benchmark price. Lloyd's of London war-risk cover for Hormuz transits has priced in the PGSA exclusion class since early May; vessels named as 'Project Freedom'-adjacent face cover withdrawal from P&I clubs operating under UK sanctions jurisdiction, regardless of flag.

The economic transmission channel runs from the PGSA exclusion list through Lloyd's underwriting through ship insurance markets to trade-finance availability for the 2,000-vessel stranded fleet.

Consensus view: The International Institute for Strategic Studies (IISS) and the Atlantic Council's Middle East programmes assess the Azizi announcement as Iran's first explicit legislative endorsement of an operational toll regime already running since early May, closing the gap between the Persian Gulf Strait Authority's yuan-denominated billing and parliamentary backing.

The combination of IRGC operational machinery and Majlis committee authority is the structural upgrade that makes the architecture durable past any single ceasefire negotiation.

Counter-view: Iran International and Tehran-based analysts close to the Majlis security committee argue the post's absence of a fee schedule or vote date reflects deliberate ambiguity: Azizi is signalling capacity, not committing to a timetable the civilian Foreign Ministry would then have to defend in back-channel negotiations through Pakistan. Tehran's dual-track architecture uses legislative endorsement as leverage while Araghchi's Islamabad channel runs the accommodation track.

Key tension: Whether the absence of a floor vote keeps the mechanism nominally reversible for Araghchi's Islamabad channel, or whether IRGC-backed operational reality has already foreclosed that distinction.

First Reported In

Update #100 · Tehran prints the toll book; Delhi joins the queue

Investing.com· 17 May 2026

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Causes and effects

Caused by

Beijing flips its blocking statute live

Azizi's X post formalised politically the PGSA yuan-toll architecture that had been collecting fees since early May (ID:3091)

Occurred 2 May 2026

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Three EU-US deadlines collide in 9 days

Lloyd's List documentation of $2m per-VLCC yuan tolls (ID:3073) is the operational foundation Azizi's announcement converted into a published political claim

Occurred 7 May 2026

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Iran's SNSC finalises Hormuz security plan; US weapons transit barred

SNSC Hormuz security plan and US-weapons transit bar (ID:3291) preceded and informed Azizi's Majlis-level toll announcement

Occurred 13 May 2026

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This Event

Azizi names Hormuz toll regime on X

First parliamentary endorsement of the operational Hormuz toll architecture puts Iran's Majlis on collision course with UNCLOS Article 38.

Led to

PGSA goes live on Hormuz transit

The Majlis-backed Hormuz toll mechanism legislated in ID:3349 moved from political signalling to operational status when PGSA launched its X account and vessel-submission process on 18 May.

Occurred 18 May 2026

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Different Perspectives

IAEA

Director General Rafael Grossi appeared in person at the UNSC on 19 May and warned that a direct hit on an operating reactor 'could result in very high release of radioactivity'. The session produced a condemnation record but no resolution, and the Barakah perimeter was already struck on 17 May.

Hengaw (Kurdish rights monitor)

Hengaw documented three judicial executions and the detention of Kurdish writer Majid Karimi in Tehran on 19 May, establishing Khorasan Razavi province as the newest geography in Iran's wartime judicial record. The organisation's Norway-based operation continues to surface a domestic repression track running in parallel with every diplomatic and military development.

India

Six India-flagged vessels conducted a coordinated cluster transit under PGSA bilateral assurances during the 17 May window, paying no yuan tolls. New Delhi's inclusion in Iran's state-to-state passage track insulates Indian energy supply without requiring endorsement of the PGSA's yuan-toll architecture or alignment with the US coalition.

Pakistan

Pakistan is the only functioning diplomatic bridge between Tehran and Washington. Its role is relay, not mediation in the settlement sense: it conveyed Iran's 10-point counter-MOU in early May, relayed the US rejection, and is now passing 'corrective points' in the third documented exchange of this sub-cycle without either side working from a shared text.

UK and France (Northwood coalition)

Twenty-six coalition members have published no rules of engagement eight days after the Bahrain joint statement; Lloyd's underwriters have conditioned war-risk reopening on written ROE from either Iran or the coalition. Italian and French mine-countermeasures deployments are operating on the in-water clearance task CENTCOM Admiral Brad Cooper's 90% mine-stockpile claim does not address.

Saudi Arabia

Riyadh has not publicly commented on the Barakah strike or the 50-47 discharge vote. Saudi output feeds the IEA's $106 base case; the $5 Brent premium above that model reflects institutional uncertainty no Gulf producer can compress through supply adjustment alone.