Trump Proposes 'Toll' for Strait of Hormuz: A New Geopolitical Chess Game
Introduction
In early 2025, former US President Trump made a startling proposal at a public speech: the US would charge a 20% "transit fee" on cargo ships passing through the Strait of Hormuz. This immediately roiled global energy markets, drawing mixed international reactions. As the world's most critical oil transport chokepoint, the Strait carries about one-third of global seaborne oil trade daily. Any claim of control over the Strait touches the nerve of international energy security. Although Trump's proposal has not been formalized, the geopolitical strategy, economic calculus, and potential impact on global trade behind it merit in-depth analysis.
Strategic Value and Current Status of the Strait of Hormuz
Located between the Persian Gulf and the Gulf of Oman, the Strait of Hormuz narrows to about 33 km at its most constricted point, serving as a vital artery connecting oil-producing countries in the Middle East to external markets. Oil exports from Saudi Arabia, Iran, Iraq, Kuwait, and the UAE all depend on this waterway. According to the International Energy Agency, about 20 million barrels of oil and LNG pass through daily, accounting for over 40% of global seaborne oil trade. Geographically and legally, the Strait is an international waterway, where states have the right to innocent passage under the UN Convention on the Law of the Sea (UNCLOS). However, Iran has long asserted jurisdiction, demonstrating control through military exercises and tanker seizures. The US maintains a military presence and freedom of navigation through its Fifth Fleet based in Bahrain.
Core Logic and Controversy of Trump's Proposal
Trump's "toll" proposal is essentially economic coercion, embedded in a multi-layered narrative. First, it links security responsibilities for the Strait with cost-sharing. The US has provided military protection for the region for years, ensuring safe passage, but not all countries relying on the Strait bear the cost. Trump has frequently complained about allies "free-riding," and this fee can be seen as an extension of his "America First" policy. Second, it aims to counter Iran. Iran has repeatedly challenged the US and its allies by seizing merchant ships and attacking tankers. Trump's tariff approach responds to this without direct military conflict, while exerting economic pressure. Third, the fee would raise US revenue and reduce the trade deficit—but this approach has serious legal flaws.
International law experts note that no country has the right to unilaterally charge tolls on international waterways unless authorized by the UN Security Council or specific treaties. If implemented, Trump's proposal would violate UNCLOS's basic principle of freedom of navigation on the high seas. Moreover, it could trigger a chain reaction: Iran might raise its own fees under the pretext of "waterway maintenance" or strengthen military deterrence; other littoral states like Oman and the UAE could assert sovereignty claims, further inflaming geopolitical tensions.
Impact on Global Economy and Energy Markets
A 20% toll on the Strait of Hormuz would affect far more than energy. At current Brent crude prices of $85/barrel, oil transport costs alone could increase by about $17/barrel, eventually passed to downstream consumers. Global inflationary pressures could intensify, especially for Asian countries heavily reliant on Middle Eastern oil—Japan, South Korea, India, and China. IMF models show that if the toll lasts a year, global GDP growth could drop 0.3-0.5 percentage points, with developing countries hit harder.
Additionally, shipping companies might be forced to reroute via the Cape of Good Hope or other alternatives, significantly extending voyages and raising insurance costs. The Suez Canal and Malacca Strait also face geopolitical risks, amplifying the vulnerability of global energy transport networks. Over the long term, Trump's proposal could accelerate global energy diversification and the transition to renewables, with countries focusing more on strategic reserves and domestic energy development.
Escalation of Geopolitical Game and Reactions
Following Trump's proposal, reactions were swift and divided. Iran's foreign ministry strongly condemned it as "a blatant violation of Iran's sovereignty" and hinted at countermeasures. Gulf Cooperation Council members like Saudi Arabia remained silent, reluctant to take sides publicly but privately expressing concern over US unilateralism. The EU and Japan opposed the move, arguing it undermines the rules-based international order. China's foreign ministry called on parties to resolve differences through dialogue, maintaining peace and stability in the Strait.
Notably, Trump is currently only a potential candidate, and his proposal has not been endorsed by the current administration. Yet even as a "trial balloon" for policy discussion, it has exposed deep challenges to the international order: when great powers privatize geopolitical tools and commodify global public goods, the space for smaller countries narrows further. In the future, a new US administration might pursue similar strategies in other critical chokepoints—such as the Malacca Strait or the Panama Canal—creating a cascading effect.
Conclusion
Trump's Strait of Hormuz "toll" proposal, though radical in appearance, reflects US dissatisfaction with global governance and its hegemonic urge to reshape rules. However, international legal boundaries, economic costs, and geopolitical backlash make it hard to implement. Nonetheless, it serves as a warning: in a world where supply chains rely heavily on a few strategic passages, any unilateral change to the status quo could trigger systemic crises. The international community should jointly uphold freedom of navigation, improve maritime dispute resolution mechanisms, and accelerate energy transition and route diversification to reduce over-reliance on single nodes. Beneath the waves of the Strait of Hormuz lie far deeper power games than the toll itself.
Keywords: Strait of Hormuz; Trump; toll; energy security; international law; geopolitics; global trade
