politics
U.S. President Proposes 20 Percent Toll on Strait of Hormuz Transit
The U.S. president announced a 20 percent toll on vessels transiting the Strait of Hormuz and ordered the resumption of bombing after an earlier ceasefire with Iran. Crude oil prices rose and stock markets fell following the announcement.
Jul 14, 2:41 AM·1m read2 sources
The Sydney Morning HeraldAudio version
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The U.S. president announced a 20 percent toll on vessels transiting the Strait of Hormuz and ordered the resumption of bombing after an earlier ceasefire with Iran. Crude oil prices rose and stock markets fell following the announcement. The strait had been open before the U.S. and Israel joined forces to wage war on Iran.
During the ceasefire period, Iran charged $3 million for a fully loaded supertanker to transit the strait. The proposed U.S. toll would raise that cost to $69 million.
Crude oil prices jumped after the announcement.
The ASX followed Wall Street lower as traders reacted to the renewed tensions. The strait carries much of the world's fertiliser exports. The United Nations World Food Program estimates that millions in Somalia, Sri Lanka and Afghanistan are struggling to meet basic food needs due to the closure.
International Law Position Last month, U.S.
Secretary of State Marco Rubio stated that no country is allowed to charge tolls or fees on an international waterway. The U.S. president's proposed toll marks a shift from that earlier position. Iran's nuclear stockpile was the original justification for the conflict, but the waterway itself has become a central point of leverage. Iran has used the strait closure as a retaliatory measure.
