Iran Mandates Ship Insurance in Strait of Hormuz, Mimicking Mob Tactics
As part of an effort to assert control over transit conditions, Iran has instituted mandatory insurance for all vessels navigating the Strait of Hormuz through its newly established Persian Gulf Strait Authority (PGSA). This insurance, initially provided free of charge for a 60-day period, effectively sidesteps a US-Iran Memorandum of Understanding that guarantees safe and toll-free passage. The PGSA, now the sole authority for processing transit applications, warns of penalties for non-compliance and reserves the right to introduce insurance fees after the initial waiver expires. Despite the US commitment to toll-free passage and ongoing negotiations for a long-term framework, shipping companies and international bodies have expressed strong opposition to any transit fees in this critical waterway.
John Q. Hosedrinker