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Iran Conflict 2026
22MAY

Hormuz tolls paid in yuan, $2m a ship

4 min read
11:08UTC

Lloyd's List confirmed vessels have paid up to $2 million per ship in Chinese yuan to obtain Persian Gulf Strait Authority transit clearance, the first confirmed payments routing outside the dollar correspondent-banking system OFAC's enforcement architecture relies on.

ConflictDeveloping
Key takeaway

A yuan toll booth at Hormuz collects revenue in a currency OFAC's screening architecture cannot automatically catch.

Lloyd's List confirmed on 7 May that vessels have paid up to $2 million per ship to obtain Persian Gulf Strait Authority (PGSA) transit clearance, with payments settled in Chinese yuan 1. Iran has not published a tariff schedule, and the PGSA registration channel that opened on 6 May still shows zero formal sign-ups from the 2,000-vessel stranded fleet. The toll route is operating in parallel without a public registry: vessels pay quietly, then transit.

The architecture matters more than the figure. OFAC, the US sanctions enforcement office, runs almost entirely on the dollar. A SWIFT message routed through a US correspondent bank trips a screening obligation under executive orders 13902 and 13224, the legal spine of the 1 May Sanctions Bulletin (SB0483) issued alongside General Licence W . The screening fires automatically; the bank has to act or face penalties. A yuan-denominated payment routes around all of it, with no SWIFT trail through New York, no US correspondent bank on the chain, and no automatic OFAC tripwire.

The legal foundation Iran is invoking is the Majlis Hormuz sovereignty law ratified on 2 May and the PGSA structure created on 5 May. Together they convert a maritime chokepoint into a domestic-law toll booth, and the yuan denomination is the architectural choice that lets Iran's PGSA collect outside the dollar system.

The template is a 2022 import. Russian crude buyers settled in yuan through Chinese correspondent banks after the 2022 SWIFT exclusions, exactly to escape the dollar-clearing leg that OFAC sanctions hook into. Iran has now extended that template from commodity sales to maritime access fees, the first known instance of a sanctioned state using yuan-denominated transit revenue at scale. SB0483 was a warning framing rather than a new prohibition; the vessels paying in yuan face secondary-sanctions risk under existing executive orders, but enforcement against a yuan transaction with no US nexus requires OFAC to designate the specific vessel or shipper rather than rely on the automatic correspondent-bank step. That is a measurably slower, more political enforcement path.

A signed MOU would unwind the PGSA collection inside a month. That ties the precedent's durability to the 9 May reply window: every day the toll collects in yuan is a day the dollar enforcement architecture falls one notch shorter, and a day the yuan-routing template hardens into a usable model for the next sanctioned state to copy.

Deep Analysis

In plain English

Ships passing through the Strait of Hormuz are being charged up to $2 million each to get through, paid in Chinese yuan rather than US dollars. That currency choice is deliberate: the US sanctions enforcement system works by monitoring dollar payments through American banks. Pay in yuan through Chinese banks, and that monitoring system cannot automatically catch it. Iran has essentially found a payment route that the US cannot block the way it normally would. A signed peace deal would end the toll system; until then, the toll keeps collecting.

Deep Analysis
Root Causes

OFAC's Iran sanctions architecture was designed for a dollar-centric global financial system in which every significant cross-border payment eventually routes through a US correspondent bank. The 2022 Russian SWIFT exclusion was the proof-of-concept that demonstrated dollar-clearing avoidance at scale.

The IRGC's finance operation observed the Russian crude routing model for three years before the 2026 conflict opened. Iran chose yuan to exploit the same structural gap: sanctions enforcement requires a US-nexus transaction in the payment chain, and a yuan toll settled through Chinese correspondent banks provides none.

What could happen next?
  • Precedent

    The yuan-denominated PGSA toll is the first confirmed instance of a sanctioned state using yuan-denominated transit revenue at scale; if it persists, it becomes the model for any future sanctioned chokepoint controller.

    Long term · 0.8
  • Risk

    OFAC's only available response, individually designating each vessel or operator, is measurably slower than the automatic correspondent-bank tripwire, creating a window in which the toll collects with near-impunity.

    Immediate · 0.85
  • Opportunity

    A signed MOU would unwind the PGSA collection within the 30-day Hormuz reopening timeline, extinguishing the yuan-routing precedent before it fully hardens into a copyable model.

    Short term · 0.65
First Reported In

Update #91 · MOU in Tehran, missiles in the strait

AGBI· 8 May 2026
Read original
Different Perspectives
Islamabad (Pakistan Armed Forces and Foreign Ministry)
Islamabad (Pakistan Armed Forces and Foreign Ministry)
Munir's cancellation reflects Islamabad's assessment that no bridging formula survives the collision of Khamenei's uranium directive, Rubio's Hormuz red line, and the sequencing gap simultaneously; Naqvi's relay role signals continued Pakistani engagement without a mandate to close any of the three gaps.
Lloyd's of London war-risk market
Lloyd's of London war-risk market
Published PGSA coordinates give underwriters the cartographic input to model tanker route exposure inside the claimed zone; OFAC's Sunday GL V ruling determines whether Hengli-Singapore dollar-clearing routes carry secondary-sanctions risk from Monday, adding a compliance layer to the existing kinetic war-risk premium.
Hengaw Human Rights Organisation
Hengaw Human Rights Organisation
Zaleh's trial lasted 'only a few minutes' before a conviction on PDKI membership charges at Naqadeh; the pattern of solitary detention, coerced confession, and minutes-long hearing is consistent with wartime political-charge architecture the organisation has documented across the Kurdish northwest.
Gulf Arab states (UAE, Bahrain, Kuwait)
Gulf Arab states (UAE, Bahrain, Kuwait)
The UAE has not published counter-coordinates to the PGSA's Hormuz zone map, leaving Emirati silence as the maritime-law response to Iran's charted boundary claim. Abu Dhabi's published position now defaults by omission toward implied acceptance of the zone's cartographic fact.
Beijing's Ministry of Commerce
Beijing's Ministry of Commerce
MOFCOM's blocking order covers Hengli and four other designated refineries on the mainland but does not extend to the dollar-clearing layer in Singapore, making Sunday's GL V expiry the first live test of whether Beijing's sanctions-defiance architecture reaches the place where dollars settle.
The White House
The White House
Trump's verbal track on Iran has produced no signed Iran-specific presidential instrument across 84 days; both financial-sector EOs signed on 19 May are unrelated to Hormuz or the IRGC. Rubio's public naming of the Hormuz toll architecture as a deal-killer is the administration's most concrete new position this week.