Tehran's Toll: Could a $2 Million Pass-Through Redraw Global Oil Costs

A fresh round of US–Iran talks centers on Tehran’s plan to let Iran charge up to $2 million per vessel transiting the Strait of Hormuz, a toll meant to fund reconstruction and extend de facto control over the chokepoint. Legality is contested under UNCLOS, and sanctions complicate payments. The toll could add about $20 million per day to oil costs (roughly $7 billion a year) and raise tanker and insurance fees, potentially keeping global prices higher even if volumes gradually return. Bruegel suggests the world economy might barely notice the cost, but the policy sets a worrying precedent and raises the risk of broader disruption or recession if tensions escalate; revenues could bolster Iran’s economy and IRGC amid sanctions and outages.