World heading into fuel ‘red zone’ as Iran vetting and tolling of ships in Hormuz revealed
Friday, 22 May 2026
As the world’s oil market heads into what the world energy body is calling the “red zone” - or highly dangerous territory where shortages and price spikes around the world are inevitable - it’s emerged Iran has formalised its dominance over the Strait of Hormuz.
World media reports are saying different things - some reporting the Islamic Republic has imposed a new transit regime on the area that has been in operation since May 18, others saying the country is in talks with Oman to establish a tolling and vetting system for vessels travelling through the waterway.
Iranian state media said on X a new Persian Gulf Strait Authority (PGSA) will vet and toll vessels on an area covering 'Kuh-e Mubarak in Iran to the south of Fujairah in the UAE… to the line connecting the tip of Qeshm island in Iran to Umm Al-Quwain in the UAE.“
It added that 'transit through this area for the purpose of passing through the Strait of Hormuz requires coordination with, and authorization from, the Persian Gulf Strait Authority.'
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US President Donald Trump and Glf allies expressed outrage at the development.
'We don't want tolls. It's an international waterway. They're not charging tolls right now,' Trump told the reporters at the White House.
He said the US was monitoring reported negotiations between Iran and Oman over possible tolls in the Strait of Hormuz, while insisting US forces maintained complete control over maritime traffic in it.
“We have total control of the Strait of Hormuz, as you know, with our blockade,” Trump said. “The blockade has been 100% effective. Nobody’s been able to get through. It’s like a steel wall.'
But the steel wall has ensured very little oil has passed out of the Middle East and into world markets, and the International Energy Agency is now warning the world is moving into dangerous new territory.
Speaking in London, executive director of the International Energy Agency Fatih Birol said the world was going into a 'red zone' in the Northern Hemisphere summer.
Birol warned fast falling fuel inventories, missing Middle Eastern exports, and rising summer demand could push global oil markets into the red zone by July or August.
He said 'no new oil was coming from the Middle East' just as demand begins climbing into peak travel season, eroding stocks.
Reuters has reported that global crude and fuel inventories fell at a pace of 5.27 million barrels per day in March and accelerated to 8.62 million barrels per day in April.
Birol, who believes the disruption being seen now dwarfs that seen in the oil shocks of 1973, 1979, and even the 2022 energy crisis after Russia invaded Ukraine, said “the most important solution' remains a 'full and unconditional reopening of the Strait of Hormuz.'
Defacto control
Reuters has reported this week that Iran is already in de facto control of Hormuz, and already facilitating government-to-government deals involving in some cases payments, sometimes as much as US$150,000 a vessel, exchanged for safe passage of ships through the Strait.
The news agency spoke to sources in global shipping as well as those belonging to Iran and other government officials to build a picture of how the Islamic Revolutionary Guard Corps control the waterway.
In early May, about 1500 vessels with about 22,500 sailors aboard were trapped in the Gulf, unwilling to chance being struck by Iranian forces along its coast. Fewer than 60 of those ships have since made it through the waterway, most of those Russian, Chinese, Indian or Pakistani.
Before the war, some 120 to 140 ships traversed the strait on a typical day, about half of them oil tankers.
Under international maritime law, the right to charge tolls on waterways depends strictly on whether the route is a natural strait or an artificial canal. While artificial canals can levy tolls for maintenance, natural international straits are legally open to unimpeded free passage.