Iran’s Hormuz Transit Toll Mechanism and What It Means at Sea

On May 16, 2026, the chairman of Iran’s Parliament National Security and Foreign Policy Committee, Ebrahim Azizi, confirmed that Tehran will “unveil soon” the full details of a new mechanism to regulate maritime traffic through the Strait of Hormuz, including fees collected for what Iranian officials describe as “specialized services.” The mechanism is administered by the Persian Gulf Strait Authority (PGSA), a recently established body that vets and approves transits through a chokepoint that, in pre-conflict conditions, carried roughly 20% of global seaborne oil trade.

Key Takeaways

• On May 16, 2026, Iran confirmed it will soon unveil full details of a transit toll mechanism for the Strait of Hormuz, administered by the newly established Persian Gulf Strait Authority (PGSA).
• Vessels seeking transit must apply via info@PGSA.ir, disclosing ownership, insurance, crew manifests, and cargo before being granted a permit.
• According to reports, some vessels have already paid as much as $2 million per transit, settled in Chinese yuan, though no official tariff has been published.
• Israel-linked vessels are banned. US-linked and “hostile country” vessels face severe restrictions or are denied access.
• The recent OFAC issued guidance warns that payments to Iran for safe passage could expose non-U.S. firms to secondary sanctions.
• Iran’s declared “control zones” appear to extend into UAE territorial waters, raising sovereignty and freedom-of-navigation concerns.
• Transit volumes remain a fraction of pre-conflict averages, with Windward identifying 167 commercial-size vessels in the Strait of Hormuz area on May 5, 2026, of which 146 were operating dark.

How the PGSA Mechanism Works

Iran established the Persian Gulf Strait Authority in May 2026, presenting it as a sovereign regulatory body governing transit through the Strait. 

In the Name of God

The official X account of the Persian Gulf Strait Authority (#PGSA) is now live.
Follow us for real‑time updates on the #Hormuz_Strait operations and latest developments.

— PGSA | نهاد مدیریت آبراهه تنگه هرمز (@PGSA_IRAN) May 18, 2026

Vessels intending to transit receive an email from info@PGSA.ir setting out the requirements. Operators must then submit a “Vessel Information Declaration” covering ownership, insurance, crew manifests, cargo, and intended routing. A transit permit is issued only after the PGSA accepts the submission and a fee is paid.

Officials have not published an official tariff. Reports indicate that some vessels have paid up to $2 million per transit, with payment made in Chinese yuan. Earlier reporting also referenced a $1.00-per-barrel toll structure for tanker cargoes. Iran’s First Vice President has stated that “enemy” military equipment will not be permitted to transit at all. Iranian state media has reported that European countries have entered discussions with the Islamic Revolutionary Guard Corps Navy to secure transit terms.

The Secondary Sanctions Exposure

For commercial operators, the most consequential dimension of the new regime is not the cost of transit. It is the legal exposure created by paying for it.

On May 1, 2026, the U.S. Office of Foreign Assets Control (OFAC) issued guidance warning that payments made to Iranian-linked entities in exchange for safe passage through the Strait of Hormuz could constitute prohibited transactions under existing U.S. sanctions, exposing non-U.S. firms to secondary sanctions risk. 

The operational implications are immediate. Payments to the PGSA, particularly through opaque channels such as cryptocurrency or yuan-denominated transfers, may not appear in a counterparty’s standard compliance trail. Charterers, traders, financiers, and insurers may be exposed to penalty risk through their counterparties’ transit decisions, regardless of whether the toll was paid by their direct contractual partner. The same compliance teams currently focused on U.S. and EU designations against the Russian shadow fleet now face a parallel exposure surface in the Gulf.

What the Strait Looks Like Right Now

The PGSA mechanism is being unveiled against an operating environment that has shifted dramatically since the start of Operation Epic Fury on February 28, 2026.

Pre-conflict transit volumes through the Strait of Hormuz averaged approximately 140 vessels per day. Windward data indicates that early May transit volumes had dropped dramatically, with only nine transits on May 11. Saudi Aramco CEO Amin Nasser told investors on the company’s first-quarter earnings call that the oil market may not normalize until 2027 if the strait’s disruption persists past mid-June.

Windward has tracked the operational picture day by day. On March 7, the Windward recorded only three crossings through Hormuz, against a seven-day average of 13.43. 

By April 11, four days into the ceasefire, Windward observed 17 transits, a slight increase, but with continued dark activity and a VLCC executing a U-turn at Larak Island rather than completing its crossing.

The dark activity dimension is the most analytically significant signal. On May 5, Windward identified 167 commercial-size vessels across the Strait of Hormuz area. Of those, 146 were operating dark. 

The Strait has not reopened in any conventional sense. It has become a controlled operating environment in which commercial movement continues, but increasingly outside the visibility frameworks that compliance and enforcement teams traditionally rely on.

The Behavioral Signals to Watch

The PGSA mechanism formalizes a pattern that vessels have been adopting informally for weeks. Over recent weeks, reporting indicates that some vessels moving through the strait had embedded ownership, cargo, and routing information into destination fields to signal compliance. This is a textbook deceptive shipping practice, being repurposed as a wartime signaling mechanism.

For compliance teams and government authorities, several behavioral indicators are now elevated in the Hormuz environment:

• AIS destination-field anomalies, where vessels broadcast compliance signals, sovereignty claims, or PGSA references rather than standard port destinations.
• Concentrated dark activity in the Strait of Hormuz, Bandar Abbas, Larak Island, Kharg Island, and Fujairah anchorage areas.
• GPS jamming and spoofing clusters near Fujairah and Khor Fakkan, degrading positional reliability across hundreds of vessels at a time.
• Pattern shifts in flag and ownership profiles for vessels successfully transiting, with non-Western-linked vessels moving while broader commercial traffic remains constrained.
• Recycled or “zombie” vessel identities, including a vessel listed as “Broken Up” in Equasis but transmitting AIS again, spoofing tracks south of the strait in mid-May.

These are not edge cases. They are the operating signals defining the Strait’s current commercial reality.

What Operators and Authorities Need to Do

For commercial audiences, the immediate priorities are:

1. Treat any payment to Iranian-linked entities as a sanctions-screening trigger, including indirect payments through brokers, agents, or charterers. OFAC’s April guidance creates exposure that does not respect contractual distance.
2. Audit AIS destination fields and behavioral signals for vessels in the Hormuz operating area, not just static designation lists. The compliance signal is increasingly embedded in vessel behavior rather than paperwork.
3. Reassess P&I and war-risk insurance exposure given the withdrawal of insurable war-risk coverage from parts of the Gulf and the rising frequency of vessel strikes since February 28.
4. Map third-party counterparty exposure to PGSA transit decisions. A counterparty that pays the toll may transmit secondary-sanctions risk upstream and downstream.

For government authorities, the strait is now an active enforcement and intelligence environment in which AIS-based maritime domain awareness has collapsed for a meaningful portion of the traffic. Multi-source verification — fusing satellite (SAR, EO, RF), behavioral analytics, and ownership intelligence — is the only practical method for maintaining situational awareness across the operating area.

Windward Is Tracking the Strait Daily

Windward has been publishing daily intelligence on the Strait of Hormuz since the start of Operation Epic Fury, combining behavioral analytics, multi-sensor satellite coverage, and ownership intelligence to identify vessels operating dark, recycled identities, and emerging transit patterns. 

That same intelligence is what reveals which vessels are paying tolls, which are transiting under PGSA permits, and which are slipping through under deceptive shipping practices. The PGSA mechanism, when fully unveiled, will codify what is already operationally underway. For commercial and government readers alike, the analytical task is unchanged. What matters is not what the paperwork says about a transit. What matters is what the vessel did, where it went, who paid for it, and what behavioral signal it left behind.